Canadian Wage Increases Down, Steady in U.S.

He presented the results of a survey of 395 large and medium-sized Canadian organizations. Conducted in July and August of 2008 prior to the economic crisis, the survey found that most respondents were planning an average pay increase of 3.9%. This outlook, however, has now changed.

“Next year, the average salary increase in Canada will be around 3%,” said Benimadhu.

Alberta is expected to lead wage increases with a rate of 5.1%, followed by Saskatchewan at 4.9%, Manitoba at 4.5%, and British Columbia at 4%. On the low end of the scale are Ontario at 3.4%, Quebec at 3.3%, and the Atlantic provinces at 3.1%.

In contrast, a similar survey conducted in the United States suggests that average planned salary increases for 2009 are consistent with plans developed last year, despite the financial crisis.

Buck Consultants’ Compensation planning for 2009 survey of 314 employers found that the average salary increases for 2009 range from 3.8% for non-exempt and non-management staff to 4% for executives and 4.1% for CEOs.

While the survey was conducted in mid-2008, follow-up questions were sent to respondents in September after the emergence of the economic crisis to gauge the accuracy of the results. Of the 32% of the original respondents that replied, only 16% said their plans have changed or are currently under review.

Half of the respondents reported that anticipated incentive payouts are likely to be similar to last year, while 26% said they will be smaller and 5% said fewer managers and employees are likely to see incentive awards in the future.

“Group and team incentives are powerful tools to improve performance,” said Larry Reissman, a principal at Buck Consultants. “In an uncertain economic climate, incentives linked to key performance indicators enable employers to focus the efforts of their people and help control compensation costs.”

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