Why do you go to work? While there are arguments from all sides for total rewards strategies that engage employees with a minimal focus on base increases, at the end of the day, base pay is what attracts and retains staff. Otherwise, we’d work for free.
Professional consulting firms can provide employers with market data on salaries so employers can ensure they’re in line with competitors. Focus groups at peer organizations are also effective at providing information while tailored surveys can be even more accurate.
Survey data can be used to ensure internal equity among existing employees and to help define market rates for hiring new talent.
Employers will often pay more to bring new, experienced talent into an organization rather than current incumbents in similar roles. It’s the oldest challenge in the talent acquisition function — figuring out how much to pay a new person — but a number of agencies are assisting employers by publishing salary guides that indicate the cost-to-hire for pertinent positions.
Starting off the year in recovery mode, the Canadian economy showed signs of strength throughout 2011 despite ominous economic headlines in the latter half of the year.
Proving to be a roller-coaster of a year, the early part of 2011 illustrated a definite optimism among Canadian business as 62 per cent reported an increase in business since 2010 and 57 per cent felt the economy was continuing to strengthen, according to an annual survey by Hays, a professional recruitment firm.
Amidst new fears of a recession in Europe and the United States in the second half of 2011, the Canadian economy slowed and in October it shed 54,000 jobs — the largest job loss in more than three years, according to Statistics Canada.
Despite this, the Canadian economy continued to grow marginally and in the third and fourth quarters was on track to grow by 2.7 per cent per annum, marking a 0.7-percentage-point increase on the Bank of Canada’s original two per cent estimate.
In 2012, the recruitment picture looks promising as 40 per cent of companies are planning on hiring in the next 12 months and about 82 per cent of all positions will be for full-time roles, according to the Hays survey of 1,300 employers.
Despite concerns over fragile European and U.S. economies, 32 per cent of companies that are planning to actively recruit in 2012 intend on doing so in the first quarter while 21 per cent will recruit in the second half of the year — waiting perhaps for economic stability or anticipated business growth.
Throughout Canada, 55 per cent of all wage increases will see a rise of one to three per cent in 2012, marking a virtual carbon copy of the trend in 2011. More than one-third of employees (39 per cent) will see their stock rise by three per cent to six per cent and a fortunate four per cent will see salaries rise by six to 10 per cent, found Hays.
There will also be a shift towards more non-traditional benefits in 2012 as more employers offer flex-time, time off in lieu, the ability to work from home and defined career paths in order to attract and retain talent, found the survey.
While most indicators point towards moderate but continued prosperity in Canada, international economic pressures will continue to affect consumer spending and general confidence.
While a large percentage of new hires will be the result of organic business growth and a continued strengthening economy, 2012 will also be a year of “wait and see” as all eyes are on the economic fragility in foreign markets and their relative impact in Canada.
Rachel Finan is a Toronto-based recruiter at Hays specializing in human resources. She can be reached at (416) 203-4075 or firstname.lastname@example.org or visit www.hays.ca for more information.