Companies lower 2009 salary increases due to economic uncertainty

Average wage increase could fall to 3.4 per cent from earlier 3.9 per cent forecast: Conference Board

Canadian workers will receive lower salary increases in 2009 as organizations focus on cost cutting in an uncertain economic environment, according to a report from the Conference Board of Canada

Even before the financial crisis began in September, organizations were projecting lower increases for 2009 and the Conference Board's 2009 Compensation Planning Outlook predicted a 3.9 per cent average non-union wage increase, down from the average actual wage increase of 4.2 per cent in 2008.

But the salary survey of 395 organizations was conducted this summer and since then global markets have taken a beating. The Conference Board predicts the projected average non-union increase in 2009 could fall by about one-half a percentage point.

"Although companies continue to face challenges in attracting and retaining talent, the global economic slowdown has made cost reduction a top priority," said Prem Benimadhu, vice-president, governance and human resources management.

Workers in the oil and gas industry are again expected to lead the country in average wage growth, although the projected increases in 2009 will fall below the six per cent gains these employees made in 2008. The lowest increases are expected in the beleaguered manufacturing sector, and in the communications and telecommunications industry.

Wage increases will vary significantly across Canada in 2009. Increases in the four Western provinces are expected to exceed four per cent on average, with Alberta' s non-unionized workers gaining an average of 5.1 per cent. Increases in Ontario, Quebec and the Atlantic provinces are expected to fall below the national average.

To read the full story, login below.

Not a subscriber?

Start your subscription today!