Retail compensation varies across the country

Toronto, B.C. retail staff earn the most while workers in Atlantic Canada lag behind in pay: survey

The latest compensation figures show retail workers are paid the most in Toronto, British Columbia and the Territories while those in Atlantic Canada trail far behind.

Mercer Human Resource Consulting’s Multi-Outlet Retail Compensation Survey, 2002 looks at information on salary levels and compensation practices for positions specific to the retail industry.

Bernadette Petitpas, a consultant with Mercer, said retail organizations are facing stiff competition with fluctuating sales and an influx of U.S.-based retailers into the Canadian market.

“Retailers face a number of challenges when it comes to compensation,” said Petitpas. “They must account for differences in geography, sales volume and high turnover rates for non-management employees. Where retailers are competing head to head, being perceived as a good employer supports staff hiring and retention.”

Full time non-commissioned retail staff

•Staff in the Greater Toronto Area, British Columbia and the Territories earn about six per cent more than the national average.

•Staff in Ontario, outside of Toronto, earn 4.9 per cent more than the national average.

•Staff in Quebec earn 2.7 per cent less than the national average.

•Staff in the Prairie provinces earn 5.5 per cent less than the national average.

•Staff in Atlantic Canada earn 16.5 per cent less than the national average.

Managerial and other professional positions

According to Mercer, the gaps are more pronounced for sales representatives than for other professional and managerial positions. For these positions, a combination of location and volume of business may influence salaries.

For example, store managers earn an average of $43,800 per year in Canada. But in stores with revenue exceeding $5 million, store managers may earn $21,000 more per year. This is especially the case in the Toronto area, where store managers with revenue above $5 million are paid on average $68,000 per year.

Regional and store volume pay differentials for store managers with volumes of $500,000 to $1 million:

•Greater Toronto: $32,600

•British Columbia and Territories: $31,000

•Ontario (excluding Greater Toronto): $30,500

•Prairies: $29,200

•Quebec: $28,900

•Atlantic Canada: $28,500

Regional and store volume pay differentials for store managers with volumes of $1 million to $2 million:

•Greater Toronto: $38,700

•British Columbia and Territories: $34,300

•Ontario (excluding Greater Toronto): $36,000

•Prairies: $33,200

•Quebec: $31,500

•Atlantic Canada: $30,400

Turnover and incentives

Turnover in retail tends to be high, according to Mercer, making attraction and retention strategies key. The average total turnover rate for non-management positions is 44 per cent compared to 17 per cent for management positions.

“Employee retention and low staff turnover goes hand-in-hand with customer loyalty,” said Petipas. “The retail workforce is more specialized than in the past, for example, sales representatives focused solely on selling electronics. Strong product knowledge and customer service skills distinguish stellar employees. As a result, training becomes key in attracting and retaining personnel.”

Some managers (22 per cent) responsible for on-site training were given an incentive or premium for doing so.

According to the survey, about 82 per cent of store managers were eligible for short-term incentives. The most common measure for individual incentives was sales volume, offered by 74 per cent. Other popular performance measures include store profitability and individual performance.

The survey also found 45 per cent had at least one type of long-term incentive plan in place, including stock options, share appreciation rights, phantom stock, performance units or long-term cash awards.

For the most part, these types of awards were limited to management. More than 90 per cent of retail managers in organizations with these awards were eligible to participate while only 21 per cent of non-management staff were eligible.

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