Wage gains to slow in '09, new survey says
Canadian companies plan to give out smaller pay increases next year, according to a new compensation survey released Monday by the Conference Board of Canada.
The Ottawa-based think tank is forecasting wage gains in the 3.9 per cent range for 2009, down slightly from 2008's actual salary rise of 4.2 per cent.
The conference board, however, said that with the growing global financial crisis, companies are more likely to squeeze wages even further in the coming year.
Indeed, the board might now be looking at pay rises that could be around three per cent.
"Turmoil in the financial markets and the possibility of a global economic downturn will put downward pressure on wage increases in 2009," said the board in its annual survey of pay trends.
In June, the Conference Board contacted 2,379 companies about their compensation plans and received 395 responses.
The answering companies, however, anticipated merely an economic slowdown, not the full-blown recession that appears more likely in the wake of September's financial crisis.
"Any deviation in the pay increase projections is likely to be in the form of downward revisions," the report said.
Even back then, corporate Canada was not very positive about the economy.
Last summer, only 48 per cent of respondents expected the economy to improve in the coming year, down from 61 per cent one year previously.
Oil leads the waySimilar to 2008, Canada's oil and gas sector said they will hike the pay of their employees by the largest percentage of any industry next year, 5.4 per cent, with other natural resource firms seeking to boost pay by 5.1 per cent.
Average salary 2008 Senior executive $249,218 Executive $164,097 Manager $102,874 Clerk $44,803 Source: Conference Board of CanadaAt the time of the survey, however, oil prices peaked at $147 US a barrel. Now, crude prices hover around $65 a barrel, less than 50 per cent of the value in early summer.
Thus, oil companies could be hard-pressed to meet the 5.4 per cent salary increase projection contained in the conference board report.
High-tech companies said they will boost pay by four per cent while communications firms will only be seeking to hike compensation to their employees by 3.1 per cent.
Unionized employees, who tend to work in lower paid professions, should see their pay envelopes rise by 3.2 per cent, less than the overall average, the survey said.
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