PLANT

Another year of modest salary gains ahead amid slow economic growth

Lowest increases (1.1%) going to oil and gas workers in Alberta.

October 26, 2016   by PLANT Staff

OTTAWA — In response to widespread uncertainty about Canada’s economic climate and business conditions, organizations are planning cautious salary increases for 2017, according to the The Conference Board of Canada’s Compensation Planning Outlook 2017

Projected average base increases for non-unionized employees are to be 2.2% next year, with the lowest increases going to workers in Alberta and in the oil and gas industry.

“The economic growth we saw in the first quarter of 2016 quickly tapered off and the energy sector has been hit particularly hard. While conditions are expected to improve, Canadian organizations are being cautious and opting for another year of modest wage increases,” said Allison Cowan, director of the Conference Board’s compensation research centre.

Workers in the high technology sector are projected to receive the highest increases at 2.8%. On the other hand, workers in the oil and gas sector are estimated to receive the lowest pay raises among the industries at 1.1%.

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Job creation in 2016 is projected to be weak at just 107,000 jobs nationally, the worst performance since the 2008-09 recession.

In contrast to years prior to 2015 where Alberta and the oil and gas sector consistently had the highest increases in the country, workers in the province and specifically those in the oil and gas sector will have the lowest raises this year. Alberta saw the lowest increases in 2016 and it is projected they will experience the same in 2017 at just 1.4%.

Energy companies are grappling with low oil prices as well as the recent wildfires in the oil patch and the subsequent temporary shutdown of oil production. These influences, compounded by low business investment in the sector, are contributing to projected salary increases in the oil and gas industry to be the lowest among all industries for 2017 at just 1.1%. Further demonstrating the economic hardship felt by many organizations in the industry, nearly half (48%) are planning to freeze salaries in 2017.

The highest salary gains are expected for the high technology industry at 2.8%, followed closely by the food, beverage, and tobacco industry and the finance, insurance, and real estate industry, both at 2.7%.

Regionally, workers in Manitoba are expected to have the highest pay raises with an average projected increase of 2.7%. In Quebec and BC, workers can expect salary gains at 2.5%, and those in Ontario and Saskatchewan at 2.4%. In the Atlantic provinces, the projected increases are low at just 1.9%.

Job creation in 2016 is projected to be weak at 107,000 jobs nationally, the worst performance since the 2008-09 recession. The percentage of organizations experiencing difficulty recruiting and retaining employees with specific skills is 58%, in line with the 59% who reported these challenges last year.

The top professions in highest demand include specialist IT, skilled trades, engineering, management, and sales and marketing.


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