Despite stronger economy, modest salary increases forecast for 2018

Average pay increase for non-unionized employees 2.4 per cent: Survey
|hrreporter.com|Last Updated: 11/01/2017
Compensation, payroll
Regionally, Manitoba, Ontario and Quebec lead the pack in terms of projected increases, with wage gains ranging from 2.6 per cent to 2.5 per cent. Shutterstock

For the seventh year in a row, Canadian organizations are planning moderate base salary increases, according to The Conference Board of Canada’s Compensation Planning Outlook 2018.

The average pay increase for non-unionized employees is projected to be 2.4 per cent next year, slightly higher than the actual increases of 2.2 per cent in 2017.

“While the Canadian economy is firing on all cylinders this year, growth projections for next year and beyond show a slowing down of the economy. As a result, business leaders continue to exercise caution, keeping a cap on organizational spending and, by extension, salary increases,” said Allison Cowan, director of total rewards research at the Conference Board of Canada.    

Projected increases are highest in the pharmaceutical and chemical products industry, at 2.7 per cent. Increases of 2.6 per cent are projected in the construction industry, along with organizations in finance, insurance and real estate; not-for-profits; the retail trade industry; and the accommodation, food, entertainment, and personal services sector.

The lowest average increases are expected in the health sector, with an average increase of 1.6 per cent in 2018, found the Conference Board.

Regionally, Manitoba, Ontario and Quebec lead the pack in terms of projected increases, with wage gains ranging from 2.6 per cent to 2.5 per cent. Meanwhile, the lowest average base pay increases are expected in Alberta and Saskatchewan, at 2.1 per cent.

In line with the past two years, 57 per cent of organizations reported challenges recruiting or retaining specific skills, found the survey of 324 organizations. Employers in Ontario experienced the most difficulties recruiting or retaining employees with particular skills.

Nearly one-half of Ontario organizations (48 per cent) indicate challenges in these areas. Industries experiencing the highest attraction and retention challenges include construction (91 per cent), communications and telecommunications (82 per cent), wholesale trade (86 per cent), and the food, accommodation, entertainment, and personal services industries (86 per cent).

The professions in highest demand continue to be IT specialists, management, accounting/finance, engineering and skilled trades. While there has been some movement in the ranks, these five specializations have remained the most sought after for over a decade.

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