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Employers project salaries to rise 2.6%

Morneau Shepell survey says getting benefits costs under control a priority.


August 29, 2012
by PLANT STAFF

Cost control and disability management were respondents’ top priorities for 2013.

TORONTO — Canadian employers expect salaries to rise by an average of 2.6% in 2013, according to Morneau Shepell’s annual Trends and Projections compensation survey.

This is a 0.2% drop from last year’s survey. The 2.6% average (roughly double the inflation rate during the survey period), includes expected salary freezes but excludes promotional or special salary adjustments, and represents a 0.2% drop from last year’s survey.

Respondents say that projected base salary increases for 2013 are within last year’s 2% to 3.5% range.

Overall, Morneau Shepell, a Toronto-based workforce programs firm, said respondents appear to be less optimistic than last year in terms of growth and profitability, especially those in Alberta.

Respondents in the finance sector expect the greatest drop in salary increases, with a forecast of 2.7% increases for management and professionals in 2013, compared to 3.4% last year.

“Sponsors of defined benefit pension plans say their key priority is to rein in escalating pension costs. Although interest rates are at historical lows, they are implementing liability-driven, investing strategies. And as a response to exploding pension costs, employers are looking into all available alternatives to modify pension cost sharing and risk.

Morneau Shepell said sponsors of defined contribution plans are focused on establishing a realistic retirement income scenario. “In addition to retirement income calculators and other decision tools, a personalized scenario is presented to participants to bring about necessary adjustments to their retirement savings strategy,” the company said in a release.

Cost control and disability management were respondents’ top priorities for 2013.

Human resource priorities continue to be talent acquisition and employee retention.

The survey was conducted between mid-June and mid-August with input from more 250 organizations employing one million people in the manufacturing (28%), services (24%), and finance (14%) sectors.

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