Wages are going up in Canada, with employers projecting an average annual pay increase of 2.5 per cent for next year, according to a new survey by LifeWorks Inc.
When excluding organizations that are planning salary freezes, the poll found average salaries are expected to rise 2.7 per cent in 2022. It demonstrates growing confidence in the country’s economic outlook compared with last year’s projection, when employers forecasted an increase of 1.9 per cent including freezes.
Read: Third of employers froze salaries in 2020, compared to projection of 2%, finds survey
Still, the salary estimates fall below Canada’s rising inflation rate, which could leave workers with less spending power despite wage hikes. Statistics Canada says the consumer price index in August rose 4.1 per cent compared with a year ago — the largest year-over-year inflation increase since March 2003.
“Expected salary increases and declining freezes is a positive news story and one that Canadian employees should feel confident in as we look to the new year,” said Guylaine Béliveau, principal in LifeWorks’ compensation consulting practice, in a press release. “We can’t, however, lose sight of the impending impact of the rising inflation rate. Employee turnover needs to be a top consideration for employers, as employees may feel stretched financially.
“Meanwhile, employers are struggling with a shortage of qualified employees. Attraction and retention are more challenging than ever. These issues put pressure on the employer’s capacity to pay. It’s a great opportunity for employers to review their offerings to ensure they’re providing competitive compensation, total rewards programs and well-being support.”
Read: How employers can tweak benefits offerings amid rising inflation
Meanwhile, a separate survey by payroll and HR management firm ADP Canada found work-life balance outweighs salary as the top perk for Canadian workers. The poll, conducted with Maru Public Opinion, found nine out of 10 remote workers surveyed hope to continue working remotely some or all days of the week, citing work-life balance as the most important factor.
When asked to compare their current priorities to those before the coronavirus pandemic, the survey found 31 per cent of working respondents said a job that respects work-life balance is more important to them now, compared to only 20 per cent who felt salary had become more important.
Read: Canadian employers expecting to increase salaries by 3% in 2022: survey