Employee health and engagement are among the priorities of human resources leaders as salary increases look likely to remain modest next year, according to a Morneau Shepell trends survey.
The firm’s annual human resources trends survey released today puts projected salary increases for Canadian employers at 2.1 per cent for 2017. That’s down from the 2.5 per cent projected last year for 2016, according to Morneau Shepell.
“With low oil prices and slow economic growth, employers continue to be cautious,” said Michel Dubé, a principal in Morneau Shepell’s compensation consulting practice. “Our survey showed that actual salary increases in this year averaged just 2.1 per cent, and employers are expecting to stay at this level for 2017 as well. These are the lowest expected salary increases that we’ve seen in more than two decades.”
While the oil and gas industry is expecting salary increases of just 0.6 per cent, those in the professional, scientific and technical areas will fare much better at 2.8 per cent. Other areas faring better include finance and insurance at 2.7 per cent and manufacturing at 2.4 per cent.
Read: Strong salary increases predicted in 2016
Besides salary issues, the survey found employee health and engagement to be a growing priority for human resources leaders. Three-quarters of respondents identified engagement as a priority, with 59 per cent citing improved physical or mental health.
“We are seeing a convergence in the way employers view health, engagement and productivity,” said Paula Allen, vice-president of research and integrative solutions at Morneau Shepell.
“In the past, they saw them as separate issues but now they understand that employee health is highly correlated with productivity. There is also a lot of interest in measurement tools that evaluate the total health of employees — not only physical and mental health but also the health of their work and personal lives, including financial health — and their skills in dealing with challenges in all of these areas.”
Read: Making the best use of salary increase survey data
Morneau Shepell conducted the survey during June and July of 2016. Besides the salary and engagement findings, it found an increasing concern by employers about employees’ preparedness for retirement in light of the move away from defined benefit pension plans. “About a quarter said they are looking at providing decumulation options for retirees, or are already doing this,” said Randal Phillips, executive vice-president and chief client officer at Morneau Shepell.