Pay increases in line with previous years
Salary increases projected for 2015 by Canadian organizations are holding steady at 2.79 per cent, in line with the 2.74 per cent increase projected in last year’s survey, according to our 2015 Salary Budget Report. Similar to last year, organizations continue to adopt a cautious and conservative outlook, despite pressures to retain and motivate employees.
This annual survey was conducted in September, and reflects the responses of 401 organizations in Canada, with the majority based in Ontario, Alberta and British Columbia.
The era of salary freezes appears to be over
In addition to the average salary increase remaining relatively steady when compared to last year, the percentage of employers that plan to freeze salaries – provide no increases at all – appears to be stabilizing at 8 per cent, the same as was projected for 2014, and similar to 9 per cent in 2013. Salary freezes appear to be less of a factor moving forward.
“Organizations appear to be staying the course when it comes to salary increases and freezes,” explained Steven Osiel, Vice President at Accompass. “However, it’s worth noting that there are more companies planning an increase of 2 per cent or more, as compared to last year’s survey – 43 per cent will be giving raises in the 2.6-3.0 per cent range.”
The industries where salaries are expected to increase the most
The average salary increase anticipated in the Engineering, Financial Services, and High Technology sectors is 3 per cent, as compared to 2.5 per cent on the low end for organizations in durable manufacturing. A full 64 per cent of respondents believe that their pay is at par with other organizations.
“Although Canadian companies are telling us that benchmarking and market position analysis are the top compensation priority, it’s interesting that the most important factor when finalizing the annual merit budget is actually internal budget constraints,” Osiel noted. “This may need to change to reflect the realities of retaining and motivating employees, which have been found to be the top organizational priority for 86 per cent of the companies that we surveyed. As more baby boomers retire and the talent pool shrinks, attracting new talent may become a priority in the near future.”
Planning for the future
“Tools like our annual Survey Budget Report are great barometers for where your company stands relative to the market,” stated Osiel. “The key here is ensuring that the data informs the salary budget decisions, and internal budget constraints are reflective of these factors. This will help organizations stay ahead of the curve when it comes to managing issues such as turnover.”
Visit our Resources page to download the 2015 Salary Budget Report.