By Mark Swartz
Monster Contributing Writer
Good news: the days of wage freezes seem to be behind us. For 2013, predictions are for an average salary increase of 3% in Canada. This is up slightly from the previous year.
Provincially, Alberta is projected as the front-runner. Overall raises there will be well above average. A little below the mean are Quebec, Ontario and the Atlantic provinces.
In terms of occupations, those in the Oil and Gas sector have reason to smile. Their raises are projected at nicely above the national average. Same goes for workers in Mining, Information and Technology (IT), and Administration too
The New Normal: 3% Increases
According to numerous salary surveys for 2013*, a “3% raise” is the new normal. This means if you are meeting expectations, you could receive anywhere between 2.5% to 3.5%. Should you exceed expectations you could receive a bit more.
In general, companies put aside a pool of money for raises, and the manager determines how the pool is spread out. If you aren't meeting expectations, expect maybe 1.8% (which is Canada's forecasted inflation rate, or cost of living increase).
Most annual increases are based on merit – which means if you’re not performing, you shouldn’t anticipate an increase. The wage formula for unionized employees, or for employees who have a written salary guarantee, is settled in advance based on negotiating power.
Which Jobs Will See The Highest Raises?
Who will be the big winners in terms of occupations? Well, "There's a war for IT talent being waged in Canada today," says Lara Dado, regional vice-president for Robert Half International, a leading recruitment firm.
Expect an increase of 4.5% if you're in the IT/Software Development
Mobile applications developers will see the highest increases (an average of 9.0 per cent), as companies look for people to help them build business using mobile media. Network engineers, business intelligence analysts, and senior IT auditors also are in demand.
A similar wage boost is expected in our energy sector (Oil and Gas jobs
is not far behind. However, these higher forecasts are more of a reflection of the demand for key skills, and the competition for skilled talent, rather than “boom times”. While the data highlights the continued strength of resource sector jobs, it could also signal a tougher environment for to maintain profit growth because of rising costs.
Salaries for Administrative
professionals are anticipated to rise an average of 3.9 per cent in 2013. Employers are refilling some roles and creating new ones to ready themselves for future growth. Positions in demand include executive assistants and customer service representatives.
Above-average salary increases also are projected for select administrative positions in the healthcare industry and in human resources.
Lowest Wage Increase Sectors For 2013
The sectors with the lowest projections for raises in 2013 are Media
(at 2.2%), Healthcare (at 2.0%), Government and telecommunications (both at 2.3%). Overall, the Public Sector is forecasting noticeably lower salary increases (at 2.5%) than is the private sector. This makes sense given government sensitivity to creating larger deficits.
Forecasted Raises By Province
Not surprisingly, it's Alberta at 3.6%, Newfoundland (at 3.4%) and Saskatchewan (at 3.2%) that lead the country. These provinces are buoyed by the continued investment in natural resources. Wage increases in the remaining provinces are forecast at around 2.6% to 2.7%.
Here's how each province is expected to do wage-wise in 2013:
Atlantic Canada 2.6%
Canada Compared To Other Countries
Canadian projections rank about average against some of the other advanced industrialized nations. We're above France (at 2.6%) and Japan (at 2.0%). However we are slightly behind other industrial countries such as the US and UK (both just above 3.0%). Canada still lags far behind the booming economies of the BRIC countries - India (at 10.0%), Russia (8.9%), China (9.5%) and Brazil (5.5%).
While there is good news for recent grads and students in terms of hiring intentions by employers, the average wage for new recruits in Canada was down by 5% in 2012. Starting salaries overall for entry-level hires are not expected to increase much in the coming year.
There are no major changes expected in variable pay trends (the way that merit-based pay is determined).
In sum, 2013 promises to be a positive one for wage increases in Canada. So long as the U.S. recovery persists, and the European financial situation remains stable, we can look forward to salary bumps that beat inflation.
*Data in the above article was sourced from surveys provided by compensation consulting firms - Aon Hewitt, Hay Group, Mercer, Morneau Shepell, Normandin Beaudry, Saucier Conseil inc. and Towers Watson - and by the Conference Board of Canada, Robert Half International and Canadian Association of Career Educators and Employers (CACEE).