2023 SALARY INCREASES: ORGANIZATIONS UNDER MAJOR PRESSURE
PROJECTED INCREASES REVISED TO 4.2% FOR 2023
TORONTO, Jan. 30, 2023 /CNW Telbec/ - Normandin Beaudry, a leader in actuarial consulting services and total rewards, unveiled the results of its pulse survey on salary increase projections. It was conducted last November and more than 440 Canadian organizations responded in less than one month. The firm's compensation experts developed the survey to monitor initial 2023 salary forecasts established last summer given the unique economic landscape and difficult job market conditions.
Revised budgets trend further upward despite volatile economic conditions
The results show that 48% of organizations changed their projected salary increases for the coming year. In Canada, the average budget was higher than initial forecasts and historical twenty-year trends, increasing from 3.8% leading up to last summer to 4.2% in fall 2022, excluding wage freezes. "Despite volatile economic conditions, organizations are continuing to invest in their pay raise budgets to adapt to an extremely competitive job market," said Darcy Clark, Senior Principal, Compensation, at Normandin Beaudry.
Additional budget for more flexibility
In addition to the salary increase budget, 43% of participating organizations plan to set aside an average additional budget of 1.4% in 2023. "Proactive organizations that plan for an additional budget will benefit from greater agility over the year. This can be used to do things like make salary adjustments in line with the market, retain employees in strategic roles and adjust compensation for high performers," Potvin explained.
Record-high total budgets
In Canada, average total budgets are now at 4.7% for 2023 as compared to the initial forecast of 4.3%, excluding freezes1. Quebec continues to lead the pack with average total budgets of 5.1%. Variations were observed across the country based on the type of organization:
Private sector (not listed on the stock market): 5.0%
Not-for-profit organizations: 4.8%
Private sector (listed on the stock market): 4.3%
Public and parapublic sectors: 4.0%
1Total budget includes the salary increase budget and the additional budget.
The services sector leads the way
Organizations in the professional, scientific, and technical services sector stand out in Canada with a revised salary increase budget of 4.7% for 2023 as compared to the initial forecasted 4.0%. IT consulting services, computer design, IT security, and AI sectors are on an equal footing, with a revised salary increase budget of 4.7%.The services sector relies on the quality of its work force, which most likely explains the higher than anticipated revisions in a context where the war for talent is fierce.
Total rewards, an integral part of the solution
An increase in cash compensation can help companies compete in the war for talent. However, there are many effective measures that do not necessarily involve an increase in fixed payroll costs. According to Normandin Beaudry's experts, a compensation strategy that offers a mix of monetary and non-monetary components can go a long way in helping organizations differentiate from competitors.
The full report and interactive tool, with details by province, industry sector, type of organization and company size, amongst others, are available on the Normandin Beaudry website.
About Normandin Beaudry
Founded in 1992, Normandin Beaudry is a leader in actuarial consulting services and total rewards. From its offices in Montreal, Toronto and Quebec City, close to 350 employees serve clients across Canada in eight areas of expertise: Pension and Savings, Pension Plan Administration, Investment Consulting, Group Benefits, Compensation, Health, Performance, and Communication.
About our compensation expertise
Normandin Beaudry's team of close to 40 compensation consultants is the largest in Canada. Through the sound and innovative use of data and technology, our versatile and creative experts provide their clients with unique and simple solutions that address their strategic and operational needs. For more information, visit https://www.normandin-beaudry.ca/en/areas-of-expertise/compensation/.
SOURCE Normandin Beaudry
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