Salary increases: The energy sector is still the leader

The energy sector dominates again this year in current and projected salary increases. This is according to the 2014-2015 Canadian Compensation Planning Survey including responses from almost 700 employers. Alberta and Saskatchewan reported the highest increases…


In 2015, the average base salary in Canada is predicted to see a 3% increase, the same prediction that was recorded in 2014. Energy remains poised as the most attractive sector to employees while the rise in salaries is expected to reach 3.7% next year following an increase of 3.9% in 2014. In contrast, other sectors such as transportation equipment, consumer goods and retail/wholesale are projected to see less impressive increases with 2.6%, 2.7% and 2.7% respectively. When the energy sector is removed from these calculations, the average base salary increase across the country falls to 2.9%.


Some provinces pay better than others


Naturally, the most energy-rich provinces are experiencing the highest current and projected salary increases. Therefore employees in Alberta should see an average increase of 3.2% in 2015, and 3.1% for Saskatchewan. Québec and the Atlantic provinces trail behind the pack with forecasts of 2.8%.


Slight disparity among employees


In 2014, pay increases have mostly been granted to senior management (3.2%) and executives (3.1%). Employees at other levels saw pay increases at or below the national average: professionals (3%), clerical and technicians (3%), production and services (2.9%). For next year, the difference will be slightly less significant with a projected increase rate ranging from 3 to 3.1%. Senior executives will see a slight decrease in the progression of their salaries (-0.1%) as opposed to employees in production and service (+0.1%).


Greater compensation for performance


Furthermore, the survey shows that employees with the best performance received more substantial salary increases. Employees that were compensated for their good performance have seen a 5.0% growth in 2014. At the same time, middle performers achieved a 2.9% increase and the lowest performers 0.3%. The trend should remain the same in 2015, with salary increase projections at 5.2% for the highest performing employees.


The importance of a career plan


Finally, the survey allowed us to see that 38% of employers have established a career path for their employees. Along with succession planning, training, professional development and monitoring performance, this plan allows employees to manage their own career choices. In turn, employers can better define their staffing requirements and manage their talent. Does this improve an organization’s performance? Among the 62% of employers who haven’t established a career succession path, half are planning on doing so.


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