StatsCan survey reveals 39 per cent of businesses planning wage increases, driven by inflation and talent retention concerns
Nearly two-fifths of Canadian businesses plan to increase average wages over the next 12 months, according to the Canadian Survey on Business Conditions released by Statistics Canada (StatsCan) Tuesday.
The survey, conducted from October to November 2025, found that 39.3% of businesses expect their average wages to increase over the next 12 months, led by businesses in manufacturing (48.6%), accommodation and food services (46.9%), and retail trade (46.3%).
The anticipated wage increases reflect dual pressures facing Canadian employers. When asked about their reasons for raising wages, businesses cited the current rate of inflation (58.7%) talent retention (49.1%) as the top factors.
Additional reasons included inflation increases (31.1%), minimum wage legislation (25.4%), recruitment (25.2%), and a tight labour market (23.6%).
Recruiting skilled workers remains persistent challenge
The survey underscores ongoing recruitment pressures across the country.
Behind inflation, recruiting skilled employees is the second most expected obstacle, with over one-quarter (26.4%) of businesses reporting hiring as their biggest expected hurdle in the next quarter.
The challenge is most acute in specific sectors. Retail trade (35.4%), accommodation and food services (34.8%), and construction (33.2%) reported the highest expectations of recruiting difficulties.
Despite wage pressures and labour market challenges, nearly two-thirds (66.3%) of businesses are very or somewhat optimistic about their outlook over the next 12 months.
“While pressures of both cost- and labour-related obstacles continued into the fourth quarter of 2025, the proportion of businesses with a positive outlook remained comparable with previous quarters,” the report states.
Wage growth expectations remain measured
Among businesses planning to increase wages, growth expectations appear cautious, with 17.0% expecting the rate of increase to be slower than last year, while 60.5% expect it to be similar, and 15.3% expect it to be faster.
Beyond those planning increases, 44.5% of all businesses expect their average wages to stay the same over the next 12 months, and 5.0% of all businesses expect their average wages to decrease.
