Canada’s biggest salary increases coming to oil patch in 2014

People who work in the oil path and those with the ability to hire and fire will get a bigger salary bump next year compared to other workers in Canada, according to a new survey.

The latest Mercer compensation report says oil and gas industry workers will see the highest salary increases next year of 4.3 4.2 per cent, followed by executives and management 3.4 3.2 per cent and 3.3 per cent respectively.

The rest of Canada isn’t so far off, with the average raise in base pay expected to rise 3.1 per cent. While that's above inflation, which currently sits at 1.3 per cent, it's below 3.2-per-cent salary increase reported in both 2013 and 2012.

“These results are indicative of a flat lining trend,” says the report released this week.

The survey results come alongside equally uninspiring economic data in Canada, where GDP growth is weak and retail sales are slipping.

Still, our salary boost is slightly higher than in the U.S. where the average increase in base pay is expected to be 2.9 per cent next year, up from 2.8 per cent in 2013, as that economy works towards a long-awaited recovery.

Mercer says the results of its survey show that, despite weak points in the economy, companies need to continue to offer pay increases to attract and retain staff in today’s competitive workforce.

“While we are seeing a flattening in salary increases across the country, competitive industries and markets continue to recognize that in order to attract and retain top-performing employees they’re going to have to reward them,” said Iain Morris, leader of Mercer's Talent consulting business for Central Canada.

“This includes higher pay increases along with other non-cash rewards such as training opportunities and career development.”

The results show star employees are getting even bigger salary increase than average workers, or even those in the oil industry.

According to the report, the highest performers got a 5.1-per-cent salary boost in 2013, which was about 6 per cent of the workforces. That compares a 2.8-per-cent bump for "middle performers," which represent about 60 per cent of workers, and those people who do nothing all day but still manage to keep their jobs got a 0.1-per-cent lift. They represent about 2 per cent of the workforce, Mercer says.

Head west for a higher salary

By province, people in oil-rich Alberta are expected to see the largest salary increase of 3.2 per cent, followed by another resource-rich province, Saskatchewan, at 3.1 per cent. Workers in Quebec, Manitoba and Greater Vancouver are forecast to see a 2.8-per-cent jump in pay next year.

That is consistent with a Hay Group survey released last week that also shows Albertans will see an average salary increase of 3.2 per cent next year. However, the Hay Group survey forecasts the pay hike for people in Saskatchewan will be higher at 3.4 per cent, while Newfoundlanders will be paid even more, with a 4-per-cent pay hike.

All three provinces are seeing their worker salaries driven higher by well-paying jobs in the oil and gas industry.

Meantime, the Hay Group survey said people in the Maritimes will only see a 2.1-per-cent pay increase, just ahead of B.C. at 2.3 per cent and both Ontario and the Greater Toronto Area at 2.5 per cent.

Mercer’s 2013/2014 Canada Compensation Planning Survey includes responses from 719 companies across Canada in five categories: executive, management, professional (sales and non-sales), office/clerical/technician, and trades/production/service. The results cover pay practices for about 2 million non-union workers. The Hay Group surveyed 500 Canadian organizations.

**Editor's note: Corrects to reflect 2014 projections versus 2013 actual values, which were initially reported.

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