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remun, the most comprehensive total rewards survey, is back for its 13th edition! Participate now.

January 2023

Salary budgets increase again in Canada 2023 with an upward salary revision!

In late 2022, more than 440 organizations across Canada took part in Normandin Beaudry’s pulse survey on salary increase projections.

The survey was meant to confirm the 2023 salary forecasts established by the organizations last summer in response to the unique economic landscape and difficult job market conditions.

Salary Forecasts : Highlights

The results show that many organizations are planning more substantial salary increase budgets than initially forecasted. Nearly half of participating organizations mentioned revising their budget upward for 2023. In Canada, the average budget is higher than initial forecasts—which have already surpassed historical trends—rising from 3.8% before the summer to 4.2% last fall, excluding wage freezes.

Beyond the traditional salary increase budget, 43% of respondents in Canada have earmarked 1.4% in additional budget, on average. This will provide these organizations with greater flexibility throughout the year. The main reasons stated to warrant an additional budget are to:

  • Make market adjustments: 76%

  • Retain strategic or critical roles: 60%

  • Retain employees at risk of leaving: 51%

These results show that, despite a volatile economy, organizations will be using their annual pay increase budgets as a key element of their talent management strategy to stand out in a highly competitive job market.

Salary increase budgets by province

This upward revision is widespread across all provinces:

  • The revised budget is considerably higher than the initial budget for all provinces and shows variations by province of up to 0.5%.

  • Quebec and Ontario have the highest revised total budgets in Canada.

While salary increase budgets are at record-high levels, it’s worth remembering that there are other effective measures to weather the current economic landscape that do not necessarily involve an increase in fixed payroll costs. A mix of monetary and non-monetary components can help organizations set themselves apart from the competition.

Salary structure increase projections

The average salary structure increases forecast for 2023 in Canada now sits at 3.2%, excluding organizations that decided to freeze their salary structure, compared to an initial forecast of 3.0% last summer.

Salary structure increases are higher than initially forecasted in almost all provinces, with Quebec and Ontario leading the pack in Canada with their upward revisions.

These significant increase projections demonstrate the value organizations are placing on their salary structure as part of their talent management strategy.

You want more information about the 2023 Salary Increase Survey and its results? Contact your consultant or email us.

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