Pay unhappiness is an issue, so StatsCan's latest numbers are encouraging
By Sarah Dobson
For quite some time now, we've been hearing about reduced or flattening wage increases.
A survey of 584 Canadian organizations earlier this year found most employers had no plans to give workers significant wage increases.
In 2018, 56 per cent of Canadian organizations budgeted between two and three per cent for base pay increases, while just eight per cent budgeted four to five per cent, and seven per cent budgeted more than five per cent, according to Payscale.
The labour markets have become very competitive in the United States and Canada, but wages haven’t necessarily gone up dramatically, according to Tim Low, senior vice-president of marketing at Payscale in Seattle.
“We’re still wondering if that is going to pop, or if there are structural changes that have actually happened behind the scenes that are keeping wages from popping back up,” he said. “(Employers) are concerned about turnover — about losing employees — but it hasn’t yet been reflected in raises necessarily across the board.”
Pay raises continue to be in line with inflation, which is expected to be 2.5 per cent, said Anand Parsan, vice-president of compensation consulting at Morneau Shepell in Toronto, when I spoke to him last fall.
“What’s quite interesting is that — given that there’s a tight labour market in Canada and unemployment is low — we’re still not seeing those high increases in salaries. You would think that it would be higher.”
But there was more encouraging news Friday when the latest Statistics Canada numbers came out showing year-over-year average hourly wage growth at 3.8 per cent in June — the strongest in a year and second best in a decade. And in Quebec, the number is five per cent.
“Very tight labour markets are clearly having an impact on wages, which posted a solid real increase,” Matthew Stewart, director of national forecast for the Conference Board of Canada, told the Canadian Press.
Let's hope the trend will continue. Why? Pay is the top contributor to job unhappiness, according to a recent survey by Ceridian of 1,891 workers in the United States and Canada.
When asked why they weren’t satisfied with their job, not making a good salary or pay was cited by 46 per cent of respondents, followed by “terrible/no job benefits” at 33 per cent, and work that isn’t interesting or appealing (27 per cent).
Women were even more likely to be unhappy with their pay (51 per cent) compared to men (35 per cent).
And in the same vein, 80 per cent of the employees said the are at least slightly stressed about pay and money issues on a regular basis, with 22 per cent saying they are “very” or “extremely” stressed.
To top that off, 27 per cent of respondents said their employer doesn’t really care about their financial well-being.
That all adds up to some pretty strong resentment around pay issues at work.
If employers really are serious about issues such as employee engagement, employee well-being and financial wellness — all under the umbrella of recruitment and retention — and their impact on the bottom line, they may realize tempered wage increases are not the best solution.