With global markets in turmoil and renewed fears of a global economic recession, one might expect that Canadian companies would be tightening their purse strings. This does not appear to be the case when it comes to salary budgets for 2012, according to a Morneau Shepell survey.
On average, respondents said they were planning salary increases of 2.8% for next year. Participants were “surprisingly” upbeat about their growth and earnings outlooks for 2012, with one-quarter expecting “significant growth in revenues and profitability.”
Salary budget increases were the lowest in the manufacturing sector, at 2.6%, while the service and financial sectors were planning increases of 2.7% and 3.2%, respectively. The highest budgeted increases were in the energy sector, with an average of 3.4%. Public sector workers can expect the lowest increases, at an average of 2%.
While salaries are headed higher, employers are looking for ways to trim the cost of their benefits programs. Health promotion initiatives are seen as effective tools in heading off the costs associated with poor health.
Those organizations with DB pension plans continue to seek de-risking strategies, while DC plan sponsors are planning to streamline and simplify the funds they offer.
The survey sample included 250 organizations, with roughly 1.2 million employees across the country.