Quebec employers remain cautious around salary increases: CRHA

Small businesses offering most generous increases

Quebec employers remain cautious and concerned about the need to recognize individual performance when it comes to salary reviews, according to a recent survey by the Ordre des conseillers en ressources humaines agréés (CRHA) and Normadin Beaudry.

Quebec organizations expect to increase salaries by an average 2.7 per cent, including freezes, for 2012, found the survey of 175 organizations. Projected budgets are slightly higher than the budgets allocated in 2009 and 2010 (2.2 per cent and 2.5 per cent respectively) and are consistent with the cautious approach adopted by employers in the last two years. These budgets are still much lower than those granted before the economic crisis, when they hovered around 3.6 per cent, said CRHA.

"Quebec employers appear to be more confident about the economy and want to continue the salary increases of recent years. What's more, the leading economic indicators are now showing contradictory trends, (such as) a still high unemployment rate combined with inflationist pressures that are hard to anticipate, forcing decision-makers to remain cautious,” said Philip Longpré, senior consultant in Normandin Beaudry's compensation and performance team.

“Depending on when various employers in Quebec will in fact award salary increases, we could see a significant difference in what was projected this summer and what will actually be granted in 2012, which will reflect the ups and downs of the economy."

Quebec City's salary increase budgets are higher (three per cent) than those of Montreal (2.7 per cent) and the rest of the province. In the next few years Montreal salaries are expected to match those in Quebec City. Previous regional differences between the two cities amounted to about five per cent, said CRHA.

Another significant difference is salary increase budgets in small businesses are considerably higher than in medium-sized businesses. For example, the difference is substantial for managers, amounting to 3.4 per cent for companies with less than 50 employees, three per cent for those with between 151 and 250 employees, and 2.6 per cent for those with between 501 and 1,000 employees, found the survey.

"In the current economic environment, it's obvious that businesses will no longer be able to rely solely on the salaries they offer to attract new talent and retain their employees,” said Florent Francoeur, CHRA’s president and CEO. “Quebec businesses will have to introduce non-monetary measures recognizing employee performance to remain competitive.”

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