2022 SALARY FORECASTS - special report - Salary Forecasts 2022
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
2022 special report SALARY FORECASTS
MESSAGE FROM THE PRESIDENT AND CEO
Despite the coming of the fourth wave, the outlook of the economic rollout over the coming months offers
some optimism. Different industry sectors that suffered shutdowns are slowly, but surely, getting back on
track. Government support measures are also answering the call.
Still, Quebec employers aren’t out of the woods yet. The labour short- Salary considerations aside, a number of now inescapable questions
age is intensifying, and salary levels are bearing witness to this though are also elbowing their way into the mix, such as work-life balance and
not equally across all sectors. We may now also be faced with what the extent to which telecommuting will be maintained going forward,
experts are calling “The Great Resignation.” The pandemic having not to mention vaccine passports and vaccination mandates. Each as
compelled many members of the workforce to rethink their priorities, salient to workers as they are to employers, they are now all part of
some analysts foresee a period during which the number resignations the equation when it comes to attracting and retaining talent.
will jump. According to Microsoft’s 2021 Work Trend Index, a signifi- In looking at salaries, Canada, Quebec finds itself leading the pack with
cant proportion of workers around the world (42%) are thinking about projected salary increases slightly higher than the national average.
leaving their current job in the coming year. Employers would be well
advised to keep this in mind and look at shoring up their talent reten- With such a unique landscape before us, the CPQ’s Special Report on
tion efforts. Salary Forecasts gives employers an opportunity to better understand
key pay trends for the coming year. With the economic recovery un-
mistakably underway, the launch of this publication takes on all the
more meaning.
Thanks to the irreplaceable contributions of its partners, this CPQ spe-
cial report offers employers expert projections to help them context-
ualize and implement compensation strategies that are in tune with
trends in different industry sectors and job categories.
Aimed at helping employers, managers, and human resource pro-
fessionals navigate the uncertainty and turbulence that continue to
characterize the landscape, the projections developed by our partner
compensation experts should help light the way.
Cordially,
Karl Blackburn
THE CPQ WOULD LIKE TO THANK THE PARTICIPATING FIRMS FOR THEIR
CONTRIBUTIONS IN PREPARING THE 2022 SALARY FORECASTS:
LIFEWORKS’S SURVEY
A total of 829 organizations from all industry sectors across Canada and representing a broad cross-section
of sales figures took part in the 39th edition of our salary projections survey.
The LifeWorks annual Canadian salary projection survey reveals that Parenthetically, 81% of organizations use salary structures to manage
non-unionized employees could see an average salary increase of 2.7% non-unionized employee salaries.
in 2022 excluding freezes, and 2.5% including freezes. In 2021, 12% of The highest projected average salary increases in Canada for 2022, ex-
organizations froze salaries whereas 36% had done so in 2020. Only cluding freezes, are expected in wholesale trade (3.1%) and construction
3.3% of organizations anticipate doing so in 2022 which may be a sign (3.0%) while the lowest projected average increases are expected in the
of things getting back to normal. In terms of salary structures, we should information and cultural industries (1.9%).
see them rise by 2.3% excluding freezes, and 2.1% including freezes.
AVERAGE SALARY INCREASE AND SALARY STRUCTURE PROJECTIONS (CANADA, BY INDUSTRY SECTOR)
AVERAGE INCREASES PROJECTED FOR 2022
INDUSTRY SECTOR BASE SALARIES SALARY STRUCTURES
INCL. FREEZES EXCL. FREEZES INCL. FREEZES EXCL. FREEZES
Overall projections 2.5% 2.7% 2.1% 2.3%
Construction 2.9% 3.0% 2.3% 2.5%
Educational services 1.8% 2.0% 1.5% 1.8%
Finance and insurance 2.7% 2.8% 2.1% 2.1%
Health care and social assistance 1.8% 2.0% 1.7% 1.8%
Information and cultural industries 1.5% 1.9% 1.3% 2.2%
Management of companies and enterprises 2.8% 2.8% - -
Manufacturing 2.6% 2.7% 2.3% 2.4%
Mining and oil and gas extraction 2.4% 2.8% 2.1% 2.3%
Other services (excluding public administration) 2.4% 2.5% 1.9% 2.1%
Professional, scientific and technical services 2.9% 2.9% 2.1% 2.2%
Public administration 2.0% 2.4% 1.8% 2.1%
Real estate, rental and leasing 2.6% 2.8% 2.1% 2.3%
Accommodation and food services 2.5% 3.0% 2.2% 3.7%
Administrative, support, waste management, and remediation services 2.4% 2.4% 1.8% 2.8%
Agriculture, forestry, fishing, and hunting 2.7% 2.7% 1.8% 2.1%
Arts, entertainment and recreation 2.4% 2.4% 2.1% 2.5%
Retail trade 2.3% 2.4% 1.9% 1.9%
Transport and warehousing 2.5% 2.7% 2.1% 2.6%
Utilities 2.4% 2.4% 2.3% 2.6%
Wholesale trade 3.0% 3.1% 2.6% 2.6%
In Quebec, projected salary increases are slightly higher than the Canadian average,
with average salary increases of 2.9% (excluding freezes), and 2.8% including freezes.
ABOUT FOR MORE INFORMATION
LifeWorks is a world leader in offering in-person and virtual solutions to support the total wellness of people. Guylaine Béliveau CRHA, MBA
We offer a range of personalized care to support our clients with their employees’ wellness and, in doing so, Director, Consulting and Compensation
foster their organization’s success. Lifeworks
guylaine.beliveau@lifeworks.com
lifeworks.com
3
MERCER’S SURVEY
Mercer has been conducting a series of pulse check compensation planning surveys to gather data on
compensation budgets. Below are the results of the March 2021 survey, which looked at 2021 actual increases,
as well as our preliminary September findings of planned salary increases for 2022.
2021 ACTUAL INCREASES — MARCH 2021 SURVEY
The actual average merit increase delivered in 2021 was
As organizations plan their “return to work”, the uncertainty due to COVID 2.5% 2.5% but dips to
and what the remainder of the year may bring remains. And yet, while COVID
2.1% when including those companies that did not deliver
continues to create challenges in many areas — from employee wellness 2.1% increases.
to return-to-work policies to revenues and budget uncertainty, the labour
market continues to pick up. Organizations that are looking to fill vacancies 2.7% Total increases were slightly higher at 2.7%;
and retain top talent will need to be able to differentiate themselves from 2.3% 2.3% including zeros.
the competition. Of those companies that indicated COVID-19 had a high
1.6% impact on their financials, the average merit was 1.6% when
including those that did not give increases
2022 PROJECTED INCREASES — SEPTEMBER 2022 SURVEY
In the September edition of the pulse survey which focused on projections
AVERAGE INCREASES, INCLUDING FREEZES
for 2022, of the over 430 organizations that participated, 84% indicated
that they are in the preliminary stages of their salary increase budget plan-
ning. Only 6% indicated their budget has been approved by leadership or 2022
the board, while 10% had put forward their number for approval. At this
point, just a few participants are planning to freeze salaries in 2022, however, 2021
14% of companies are still undecided.
2020
For those that reported a proposed merit increase budget, the average
for all employees, including zeros (i.e., freezes) is 2.6% – comparable
2019
to 2019 levels. When excluding zeros, that number increases slightly
to 2.7%. Total increase budgets, which include market, promotion 0 0.5 1 1.5 2 2.5 3 3.5
and other adjustments, were reported to be 2.9% excluding zeros. In Total Increases Merit Increases
Greater Montreal, merit is forecasted to be 2.7% and the total increase
budget is 3.1%, with no reported salary freezes.
FINAL THOUGHTS
While salary increase data is a key input for human resources professionals, these are not normal times. As the
economy recovers, the job market is heating up. Salary increase budgets are one of many levers that organizations
can pull and they should take into account the organization’s economic situation, the competitive pay positioning
of its critical jobs and sought-after skills, any planned hiring, and the organization’s differentiation strategy.
ABOUT FOR MORE INFORMATION
Mercer believes in building brighter futures by redefining the world of work, reshaping retirement and investment Jean-François Thibault
outcomes, and unlocking real health and well-being. Mercer’s approximately 25,000 employees are based in 43 coun- Principal and Career Lead, Eastern Canada
tries and the firm operates in over 130 countries. Mercer is a business of Marsh McLennan (NYSE: MMC), the world’s Mercer
leading professional services firm in the areas of risk, strategy and people, with 76,000 colleagues and annual rev- jean-francois.thibault@mercer.com
enue of over $17 billion. Through its market-leading businesses including Marsh, Guy Carpenter and Oliver Wyman, mercer.ca
Marsh McLennan helps clients navigate an increasingly dynamic and complex environment.
4
NORMANDIN BEAUDRY’S SURVEY
This summer, more than 600 organizations across Canada took part in the 11th edition
of the Salary Increase Survey.
Proactive management of salaries is your best strategy in response The average salary structure increase granted in 2021 in Canada was
to the current labour shortages and economic recovery. Based on the 2.1%, excluding organizations that decided to freeze their salary
results of this survey, the demographic profile of your workforce and structure. The average drops to 1.7% when those organizations are
your compensation infrastructure, you can start working on calculating, taken into account, which is due to 13% of organizations freezing the
targeting and, finally, convincing your management committee on the salary structure of non-unionized employees.
importance of taking action.
Full details of the survey are available on our interactive platform.
EVOLUTION OF SALARY INCREASES
IN QUEBEC (EXCL. ZEROS)
While more than 20% of companies were planning on freezing salaries
last summer, only 8% of participating organizations actually froze
3.2
wages in 2021 and 3% of them intend to freeze salaries in 2022. 3.1
While economic indicators support a recovery, salary increase budgets 3
remain reasonable as they are at approximately the same level as be-
Pourcentage %
2.9
fore the pandemic. 2.8
2.7
For a third consecutive year, the average budget in Quebec, excluding
2.6
freezes, is greater than or equal to 3%. 2.5
Although the pandemic is synonymous with decreased revenues for 2.4
many organizations, others seized this opportunity to accelerate their 2.3
2012 2014 2016 2018 2020 2022
growth. This was especially the case for the technology sector, which
averaged salary increases of 3.7%. Projected Granted
OVERALL SALARY INCREASES FOR NON-UNIONIZED EMPLOYEES BY PROVINCE
TOTAL SALARY INCREASE BUDGET SALARY STRUCTURE INCREASE
GRANTED IN 2021 PROJECTED FOR 2022 GRANTED IN 2021 PROJECTED FOR 2022
PROVINCES
EXCL. INCL. EXCL. INCL. EXCL. INCL. EXCL. INCL.
N* FREEZES FREEZES FREEZES FREEZES
N* FREEZES FREEZES FREEZES FREEZES
Quebec 355 3.0% 3.0% 3.0% 3.0% 291 2.3% 2.1% 2.3% 2.3%
Ontario 226 2.8% 2.6% 2.8% 2.7% 161 2.1% 1.7% 2.1% 2.0%
British Columbia 267 2.6% 2.4% 2.8% 2.7% 183 2.2% 1.6% 2.3% 2.1%
Alberta 157 2.5% 2.1% 2.7% 2.5% 111 2.1% 1.2% 2.1% 1.8%
Saskatchewan 83 2.4% 2.2% 2.5% 2.4% 59 1.9% 1.4% 1.9% 1.8%
Manitoba 73 2.5% 2.2% 2.6% 2.4% 52 1.9% 1.3% 2.0% 1.8%
New Brunswick 53 2.6% 2.3% 2.6% 2.4% 44 1.9% 1.3% 2.0% 1.7%
Nova Scotia 59 2.5% 2.4% 2.6% 2.6% 49 1.9% 1.6% 1.9% 1.9%
Prince Edward Island 19 1.9% 1.6% 2.2% 2.2% 18 1.7% 0.9% 1.9% 1.9%
Newfoundland and Labrador 41 2.6% 2.5% 2.8% 2.8% 37 1.9% 1.3% 2.0% 1.9%
Yukon 15 2.3% 2.2% 2.7% 2.7% 11 1.2% -- 2.0% 2.0%
Nunavut 4 2.5% 2.5% 2.4% 2.4% 4 -- -- 2.2% 2.2%
Northwest Territories 11 2.8% 2.8% 2.5% 2.5% 7 1.9% -- 2.4% 2.4%
CANADIAN AVERAGE 2.8% 2.6% 2.8% 2.7% 2.1% 1.7% 2.2% 2.0%
* N = number of organizations
ABOUT FOR MORE INFORMATION
Founded in 1992, Normandin Beaudry is a leader in actuarial services consulting and total rewards. Close to 300 Anna Potvin
employees working out of Montreal, Toronto and Quebec City serve clients across Canada in eight areas of expertise: Senior Consultant, Compensation
Pension and Savings, Pension Plan Administration, Investment Consulting, Group Benefits, Compensation, Health, Normandin Beaudry
Performance, and Communication. apotvin@normandin-beaudry.ca
normandin-beaudry.ca
5
PCI COMPENSATION CONSULTING’S SURVEY
Salary projections for 2022 are very similar to the ones seen pre-pandemic. Given the current job market,
we had expected to see salary increase budgets rise. That being said salary projection surveys are led in the
summer— too soon to have all budget information on hand— and focus on the regular salary review cycle. It is
quite possible that amounts earmarked for compensation were not entirely captured.
SALARY INCREASES PAY TRANSPARENCY
Actual and projected salary increase budgets come in at a median of Results reveal that 35% of organizations saw improvement in pay trans-
2.5%, but the average rises to 2.9%, excluding freezes. The table below parency. Beyond disclosing “how much,” we know that communicating
presents salary increase budgets for a sample of industry sectors from why and how compensation policy is applied helps improve employee
our survey. perception.
Of the organizations surveyed, 52% have additional budgets for specific In 56% of organizations surveyed, total compensation policy is disclosed
instances involving non-unionized employees. Total additional budgets to employees by managers, among which 80% have the resources and
projected for 2022 across these organizations come in at an average of tools to do so. Since managers are essentials to the relationship employ-
2.1%, which translates to a projected total budget average of 4% for ees have with their organization, they need to be involved in communicat-
2022. On average, salary structures will be adjusted by 2%. ing compensation decisions.
Nearly all organizations (92%) indicated that they faced challenges in Pay transparency remains limited with 80% of organizations disclosing
terms of employee recruitment and/or employee retention. 70% of or- no more than job-specific pay scales and 24% disclosing no direct com-
ganizations adjusted their entry-level salaries to help recruit qualified pensation information other than salary. Only 26% of organizations offer
employees and 90% saw an increased trend in hiring demand, particu- their managers some form of total compensation training.
larly for jobs in production and finance. Considerable pressure surrounding how total compensation is packaged
should bring organizations to make compensation policy more transpar-
ent for employees and to increasingly invest in their managers.
SALARY INCREASES
% ORG. ACTUAL 2021 % ORG. PROJECTED 2022
INDUSTRY SECTOR
W/FREEZE P50 AVERAGE W/FREEZE P50 AVERAGE
Arts and recreation / Accommodation and food services 18.8% 2.5% 2.5% 18.8% 2.0% 2.4%
Distribution / Wholesale and retail trade 5.3% 2.7% 4.1% 0.0% 2.6% 4.1%
Manufacturing / Construction / Processing 6.7% 2.5% 3.1% 2.7% 2.5% 2.8%
Insurance and finance / Real estate 5.9% 2.5% 3.1% 5.9% 2.5% 3.0%
Professional, scientific, technical, administrative, and management services /
5.9% 2.7% 2.9% 0.0% 3.0% 3.0%
Business services
Information and communication technology / Telecommunications 5.9% 2.8% 4.4% 0.0% 3.0% 3.0%
ABOUT FOR MORE INFORMATION
Recognized as a strategic partner by hundreds of organizations in the private, public, parapublic, not profit, and vol- Evelyne Gaudreau
untary sectors, PCI offers a full range of total compensation services at the management and governance level, and Consultant
at all employee category levels. For over 20 years, PCI has helped clients stand out in their complex and continually PCI Compensation Consulting
evolving environments by providing them with customized compensation programs that not only respond to the egaudreau@pcicompensation.com
realities of their business but also leverage industry best practices. pcicompensation.com
6
WILLIS TOWERS WATSON’S SURVEY
The 2021 Salary Forecast Survey was led by Willis Towers Watson Data Services from April to June 2021
among 679 Canadian businesses across all industry sectors. It presents data on salary increases as a
percentage of past years and the current year and also includes projections for the coming year.
CANADIAN EMPLOYERS ANTICIPATE INCREASINGLY HIGHER INCREASES FOR HIGHER-PERFORMING
GENEROUS SALARY INCREASES IN 2022 EMPLOYEES
Salary increases are making a comeback. Canadian businesses project Survey results revealed that businesses continue to reward their best
offering greater salary increases in the coming year as they recover from employees with increasingly generous raises compared to those earned
the pandemic’s economic fallout and invest increasing efforts towards by their lesser performing counterparts. The highest performing man-
employee recruitment and retention. agers and professionals earned themselves an average 4.4% increase
Survey respondents project an average 2.7% increase in salaries for exec- this year, representing 83% more than the increases granted to employ-
utives, management, professionals, and support staff in 2022. ees with an average performance. This same trend is also seen among
support staff and hourly workers.
Production and manual labour employees can expect an average 2.6%
increase in 2022, compared to the 2.2% they saw this past year, this rise
against a backdrop of an exploding demand for labour and a shortage of
hourly workers and of certain professionals with rare and highly sought-
after skills.
AVERAGE PROJECTED INCREASES
SALARY INCREASES BY INDUSTRY SECTOR SALARIES STRUCTURES
INCL. FREEZES EXCL. FREEZES INCL. FREEZES EXCL. FREEZES
NUMBER OF RESPONDENTS 679 652 345 282
ALL JOB CATEGORIES COMBINED 2.8% 2.9% 1.7% 2.1%
INDUSTRY SECTORS
Energy, mines, oil and gas 2.3% 2.5% 1.1% 1.9%
Manufacturing 2.8% 2.9% 1.9% 2.2%
Utilities 2.4% 2.8% 1.2% 1.7%
Transport and warehousing 2.7% 2.7% 2.0% 2.2%
Wholesale and retail trade 2.9% 3.0% 1.4% 1.8%
Finance and insurance 2.7% 2.9% 1.6% 2.0%
Professional, scientific and technical services 2.8% 3.0% 1.5% 2.0%
Information and communication technology 2.6% 2.7% 1.8% 2.1%
JOB CATEGORIES
Upper management and executives 2.7% 2.9% 1.7% 2.2%
Other managers and professionals 2.7% 2.8% 1.7% 2.1%
Operations and production 2.6% 2.8% 1.7% 2.2%
Administrative and technical support staff 2.7% 2.8% 1.7% 2.1%
NUMBER OF EMPLOYEES
Under 300 employees 2.9% 3.0% 1.9% 2.2%
300 – 999 employees 2.7% 2.9% 1.7% 2.2%
1,000 – 4,999 employees 2.8% 2.8% 1.7% 2.0%
5,000 or more employees 2.4% 2.5% 1.4% 1.9%
ABOUT FOR MORE INFORMATION
Willis Towers Watson is a world-leading consulting and brokerage firm helping clients all around the world find Stéphane Paré
solutions that turn risk into avenues for growth. With roots dating back to 1828, today Willis Towers Watson is Senior Director
45,000 employees strong across more than 140 countries and markets. Willis Towers Watson
stephane.pare@willistowerswatson.com
willistowerswatson.com
7
Graphic Design: Regroupement Loisir et Sport du Québec
Conseil du patronat du Québec
1010 Sherbrooke Street West, Suite 510
Montreal (Quebec) H3A 2R7
Tel.: 514.288.5161
Toll free: 877.288.5161
cpq.qc.ca
With the collaboration of several of the best compensation consulting firms,
the CPQ launched and presented the 2022 salary forecasts report
during a videoconference activity on Tuesday, September 28, 2021.
You can also read
