Employees hoping for a massive raise might be disappointed, but there’s good news for top performers
Canadian workers are unlikely to see big pay increases in the coming year, although top performers are expected to get “significantly larger raises” to entice them to stay.
A Willis Towers Watson Data Services survey of 312 companies suggests there’ll be base salary increases of 2.8 percent across the board, compared to 2017’s 2.7 percent for non-executives and 2.9 percent for executives.
Ninety-four percent of respondents projected base salary increases for some or all employee groups, slightly up from 90 percent granting increases in 2016.
Employers said they would continue to reward their best performers with bigger pay rises, both to retain them and because they wanted to strengthen their own commitments to paying for performance.
There’s also good news at companies that granted no pay rises 2016: only 11 percent plan to maintain salary freezes in 2018. Overall, just six percent of respondents project no increase in 2018.
Annual performance bonuses are also projected to remain steady or rise slightly in 2018 for most employee groups.
“Most companies are not under pressure to significantly increase their salary budgets in the near term,” said Lucille Raikes, senior consultant of rewards at Willis Towers Watson.
“Companies are relying more on variable pay, such as annual incentives and discretionary bonuses, to recognize and reward their best performers. At the same time, they are rewarding star performers with substantially larger increases while granting minimal increases – if any – to their weakest performers.”
Related stories:
New study: why it pays to talk about pay
Work flexibility as good as a pay rise?
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A Willis Towers Watson Data Services survey of 312 companies suggests there’ll be base salary increases of 2.8 percent across the board, compared to 2017’s 2.7 percent for non-executives and 2.9 percent for executives.
Ninety-four percent of respondents projected base salary increases for some or all employee groups, slightly up from 90 percent granting increases in 2016.
Employers said they would continue to reward their best performers with bigger pay rises, both to retain them and because they wanted to strengthen their own commitments to paying for performance.
There’s also good news at companies that granted no pay rises 2016: only 11 percent plan to maintain salary freezes in 2018. Overall, just six percent of respondents project no increase in 2018.
Annual performance bonuses are also projected to remain steady or rise slightly in 2018 for most employee groups.
“Most companies are not under pressure to significantly increase their salary budgets in the near term,” said Lucille Raikes, senior consultant of rewards at Willis Towers Watson.
“Companies are relying more on variable pay, such as annual incentives and discretionary bonuses, to recognize and reward their best performers. At the same time, they are rewarding star performers with substantially larger increases while granting minimal increases – if any – to their weakest performers.”
Related stories:
New study: why it pays to talk about pay
Work flexibility as good as a pay rise?
Want the latest HR news direct to your inbox? Sign up for HRD Canada's daily newsletter.