The Canadian employment picture looks mixed in 2010, with the majority of Canadian organizations planning to hire new staff while more than one-third are still planning targeted layoffs, according to a new survey.
The Towers Watson survey of 459 global employers, including 73 in Canada, found 87 per cent of Canadian employers plan to hire for new positions this year. However, 39 per cent are also planning targeted workforce reductions, down slightly from the 44 per cent that have done so since the beginning of the recession.
Employers in the United States are a bit more optimistic, with 92 per cent planning to hire and 36 per cent planning layoffs.
"Without question, the last 18 months have been challenging for employers and employees, and while there are signs of improvement, it's clear we're not going back to 'business-as-usual' anytime soon," said Kevin Aselstine, managing director for Towers Watson in Canada.
"As always, the question is how lean can companies run - especially as demand for products and services rises? Those slower to reinvest in their workforce could find themselves at a competitive disadvantage."
The survey also found 15 per cent of Canadian respondents reported lower productivity compared to pre-financial crisis levels, while 38 per cent reported higher productivity. This is lower than the more than one-half of respondents in the U.S., Europe and the Asia-Pacific that reported higher productivity compared to pre-recession levels.
The recession's impact on employee engagement has also been mixed. While 27 per cent believe employee engagement has risen since before the financial crisis, 23 per cent report lower engagement today. For 2010, far more companies expect engagement to rise (36 per cent) than decline (8 per cent).
More than one-quarter (27 per cent) of Canadian respondents agree it's easier to retain talent now than it was before the financial crisis. However, 41 per cent think retention will be more difficult one year from now.
"While many organizations have clearly sustained and even improved employee engagement in very difficult times, that could change if employees begin to burn out under the weight of increased market pressure and heightened workloads. That's when retention risk becomes very real - and a potential threat to growth," said Aselstine.
The survey also asked employers about salary increases and bonuses. Canadian employers expect the median salary increase in 2010 to be 2.5 per cent, compared to three per cent in the U.S. and two per cent in Europe. Employers expect to fund their bonus plans at 100 per cent this year, compared with 94 per cent in 2008 and 90 per cent in last year.