Canadians can expect to see an average salary raise of 2.3 per cent next year, according to a new survey of employers.
That’s just a tick above the actual average raise of 2.2 per cent that companies have registered so far this year, according to research by Morneau Shepell, a human resources consulting company. It’s also comfortably above inflation, which currently stands at around 1 per cent in Canada.
“Employers are relatively optimistic about the coming year,” said Michel Dubé, a principal in Morneau Shepell’s compensation consulting practice. “Those expecting better financial performance in the coming year outnumber those expecting weaker performance by four to one.”
Indeed, it’s been a bang-up year so far for the Canadian jobs market. The economy has been churning out an average of 28,000 net new jobs per month so far this year, a pace “well above” what’s needed to keep pace with the number of new entrants into the labour force, according to RBC economist Josh Nye. Meanwhile, the country’s unemployment rate tumbled to its lowest level since 2008 last month, at 6.3 per cent.
And of the of the 388,000 jobs Canada added over the last year, more than 90 per cent have been in full-time employment.
It’s no wonder employers are in the mood for some wage hikes.
However, how much of a boost you’re likely to get to your personal economy depends on your job and where you live.
Best jobs for getting a raise next year
The utilities sector will see the largest salary increases next year, with raises averaging 2.9 per cent, according to Morneau Shepell.
The next best place to be is the finance and insurance industries, where wages will climb an average of 2.7 per cent.
Workers in manufacturing and wholesale trade will also see average pay hikes of 2.7 per cent, though that partly reflects a “catching up” after lower-than-average increases over the past few years, the report noted.
Worst jobs for getting a raise
The resource sector and the public sector are likely to see the smallest pay increments, according to the survey.
Salaries in mining and oil and gas extraction are expected to inch forward just 0.8 per cent in 2018, which would be below the current pace of inflation.
And wages in public administration, health care and social assistance will probably climb just 1.7 per cent next year. Employers in the education sector predicted a slightly higher wage increase of 1.9 per cent.
Not much of a boost from minimum wage increases for the retail sector
Canadians working in the retail sector, which accounts for 11 per cent of Canadian employment, are unlikely to see strong wage gains, the survey suggests. And that’s despite planned minimum wage increases in Alberta and Ontario.
In Alberta, the minimum wage is set to rise from $12.20 per hour to $13.60 an hour on Oct. 1, followed by an increase to $15 an hour on Oct. 1 of 2018.
The Ontario government said July 21 it is moving forward with legislation that would raise the province’s minimum wage from $11.40 an hour to $14 per hour on January 1, 2018, and $15 per hour on January 1, 2019.
“These proposed changes are likely incorporated in the expected salary increases reported by employers in these provinces,” Dubé told Global News in a statement.
And yet, employers in the industry predicted wages would rise by 2 per cent, below the national average.
Average wage raises by province
The survey also revealed considerable regional differences, with Quebec topping the chart as the province with the highest expected average wage increase, at 2.6 per cent. British Columbia comes in next with 2.4 per cent, as does Newfoundland and Labrador, despite the economic struggles the province has recently faced. Manitoba ranks third, with salaries likely to climb 2.3 per cent. Saskatchewan and Ontario are slightly below the national average, with 2.2 per cent, followed by New Brunswick and Nova Scotia (2.1 per cent). Alberta comes last, with pay raises expected to average just 1.8 per cent.
WATCH: Canada’s highest, lowest paid regions, by average hourly full-time wage
Still, any of those numbers look good in comparison with the latest wage increase estimates from Statistics Canada.
Wage growth stood at just 1.2 per cent in July, according to the agency.
That’s far below what employers in the Morneau Shepell study predict for next year and what they reported for this year. According to the survey, Canadians’ average actual pay has risen 2.2 per cent so far this year.
One key difference is that the StatsCan number measure wage growth over the course of 12 months, while the survey’s numbers for 2017 look increases in salaries awarded in 2017, Dubé noted.
Still, wage measures from other surveys more closely comparable to StatsCan’s labour force data also show more generous pay increases of 2 per cent year over year, according to RBC’s Nye.