Will salary increases alone help employers regain solid footing in a turbulent labour market?
TORONTO, Sept. 27, 2022 /CNW/ - According to Eckler's inaugural compensation planning survey, the national average base salary increase for 2023 is projected at 4.2% (excluding planned salary freezes), which parallels 2022 actual base salary increases.
According to Anand Parsan, National Compensation Practice leader at Eckler, "Salary planning for 2023 has been rife with complexity. We are seeing the highest projected salary increase in two decades as organizations try to balance the impact of rising inflationary pressure and a tight labour market against a backdrop of surging interest rates and anticipated economic downturn. Based on actuals seen in 2022, time will tell if the 4.2% will remain constant or push higher as organizations weigh their budget and talent management needs."
Organizations look to regain solid footing among the turbulence
The survey results show that Canadian organizations are planning to use compensation as a key part of their talent management strategy as they look to regain some certainty with just 1% of organizations reporting a planned salary freeze for 2023.
Added Parsan, "While we have transitioned away from the conservatism we saw during the pandemic, as organizations look to offset red-hot inflation and a tight labour market, we were surprised to see that there are a fair number of organizations (44%) that remain undecided about salary budgets for 2023. Perhaps this 'wait and see' approach is another attempt to gain some certainty as they look to what their competitors are doing."
Key results by province and industry:
British Columbia, Ontario and Quebec are projecting the highest average salary increases at 4.1%.
The lowest anticipated salary increases range from 3.2% to 3.5% for the Yukon, Nunavut and Prince Edward Island respectively.
The highest projected average salary increases by industry are expected to be in information technology (5.4%), membership organizations/professional associations (5.3%), media & telecommunications (5.1%), and construction (5.1%).
Education (2.5%), health care (2.7%), agriculture (3.4%) and hospitality (3.5%) reported the lowest projected salary increases.
A total rewards approach
Chris Brisebois, who leads Eckler's largest Pension and Benefits consulting practice, said, "Compensation is certainly a key component in an organization's rewards strategy. However, large salary increases alone may not be enough. If you want to become an 'employer of choice', the employment offer will need to be more holistic."
According to the survey results, human resource (HR) priorities for the next 12 months will indeed be focused on broader initiatives. The top HR initiatives reported include:
Diversity, equity & inclusion initiatives (32%)
Talent retention (31%)
Employee engagement (25%)
Brisebois added, "We were not surprised to see that organizations are focused on initiatives like DEI, talent retention and engagement because many organizations are struggling with similar issues right now. What will set an organization apart is a comprehensive total rewards strategy that supports each of these objectives while also meeting the needs of a diverse workplace." Brisebois concluded, "If employees do not perceive that there is value in the rewards you are offering, you may be less likely to attract and keep the talent you need to achieve organizational objectives."
About the Survey
Eckler's inaugural Compensation Planning Survey, was conducted from July to August 2022 and collected responses from 269 Canadian organizations across diverse sectors and industries. Survey results provide critical data on salary, pay administration practices, market trends and human resource priorities.
Established in 1927, Eckler Ltd. is one of the longest-established and most respected consulting and actuarial practices in Canada. With over 300 employees, we are the largest independent benefits and pensions consulting firm in the country. Our head office is located in Toronto, with additional offices in Halifax, Montreal, Quebec City, Winnipeg and Vancouver; and two offices in the Caribbean (Jamaica and Barbados).
Our seasoned team of compensation and total rewards experts excel at helping organizations navigate complex pay structures and total rewards programs.
Visit us at: Eckler.ca
SOURCE Eckler Ltd.
View original content to download multimedia: http://www.newswire.ca/en/releases/archive/September2022/27/c1697.html