Salary Increases Forecast For Canada in 2014

Forecasting a modest increase

Salary Increases Forecast For Canada in 2014


By Mark Swartz
Monster Contributor

Wages of employees in Canada are set for another modest rise in 2014. Salaries are expected to increase, on average, by 2.8 percent.

This outpaces our country’s forecast economic growth of just 2.5%. More importantly, it beats inflation, which should hover below two percent for the year.
As in 2013, the divide between eastern Canada and the west persists. Wages in the west will grow somewhat faster, due to the many energy and natural resources jobs.

Projected Winners In 2014
The biggest salary gainers are likely to be technology workers (+ 5.5%), oil sands employees (+4.2%), and financial professionals (+3.2%).
Just four percent of employers say they’ll be freezing wages in 2014. This is down slightly from five percent of organizations that reported a freeze in 2013.
Services (+3.3%), Credit Unions (+3.2 %), Chemicals (+3.1%) and Utilities (+3%) are industries forecasting increases that are higher than the national average.  Overall, the private sector is expected to provide noticeably higher salary increases (+3%) than the public sector.
A clear split between the provinces continues, with resource-rich provinces coming in between +3.2% to +4.0%.

Which Jobs Will See The Highest Raises?
In terms of actual occupations, who will be the largest gainers?
Demand for people in the IT/Software Development field remains high. Salary increases of 4% could be the norm.
Mobile applications developers continue to do very well. They’re expected to get the highest increases, at more than 8%. Data warehouse designers, Network engineers, business intelligence analysts, and senior IT auditors will also see extra high raises.
Salaries for Administrative professionals are anticipated to rise an average of 3.5 per cent in 2014. Positions in demand include executive assistants and customer service representatives.
Other higher than average sectors: Chemicals (+3.3%), Business / Professional services (at 3.2%) and private sector Utilities (at 3.1%).

Lowest Wage Increase Sectors For 2014
The sectors with the lowest projections for raises in 2014 are Healthcare (+1.8%), Leisure/Hospitality (+2.0%), Retail, Consumer Durables and Forestry & Paper (all +2.1%).
Overall, the Public Sector is forecasting noticeably lower salary increases (+2.4%) than is the private sector. This trend is part of the government’s continued attempt to rein in spending. 

Forecasted Raises By Province
Regionally, the west is again projected as the front-runner. According to the Conference Board of Canada, "The divide between East and West persists. Frenzied resource development and near bottom unemployment rates means that Alberta and Saskatchewan are again expecting to offer the highest pay increases next year."
Also benefiting from a natural resource focus is Newfoundland and Labrador, which expects Canada’s highest pay boost (+4%). Next are Saskatchewan (+3.4%), and Alberta (+3.2%). These provinces are buoyed by the continued investment in natural resources.
Here are the salary increases forecast by province for 2014: 

BC                                          2.8%
Alberta                                   3.2%  
Saskatchewan                      3.4%
Manitoba                                 2.8%
Ontario                                    2.6%
Quebec                                   2.8%
Atlantic Canada                      2.5%
Newfoundland                        4.0% 

Other findings
Short-term incentive pay practices are widely used across most industry sectors. Actual short-term incentive payouts exceeded targets last year. In 2013, payouts were 11.6 percent of total base pay spending versus a planned target of 11 percent. Short-term incentive targets for 2014 are similar to last year. The highest short-term incentive pay targets will be in the oil and gas sector at 16.6 percent.

Iain Morris, leader of consulting firm Mercer's talent arm for central Canada, reported to the media that, “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. This includes higher pay increases along with other non-cash rewards such as training opportunities and career development.”
Overall, the moderate pay increases reflect the Canadian economy. We are past the recession, and moving ahead solidly, though at a modest clip. This bodes well for future years.

*Data in the above article was sourced from surveys provided by compensation consulting firms - Aon Hewitt, Hay Group, Mercer, Morneau Shepell, and Towers Watson - and by the Quebec Employer’s Council, Conference Board of Canada and Robert Half International.