BUSINESS

Now That Oil Has Crashed, This Is Where Canada's Biggest Wage Gains Will Be

09/10/2015 12:59 EDT | Updated 09/10/2015 12:59 EDT
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For the first time in a long time, Canada’s energy workers won’t see the country’s largest wage gains next year, according to two surveys released this week.

In fact, oil and gas workers are set to see the country’s slowest wage growth, according to a survey of employers by Hay Group, a management consulting firm.

They can expect only a 1.5 per cent pay hike next year, much lower than the 2.4 per cent average salary increase the survey forecasts for the country as a whole.

In oil and gas, “the labour supply now exceeds demand,” the study said.

Instead, the survey sees the largest wage gains going to employees at credit unions (up 3 per cent) and workers in leisure/hospitality (up 3 per cent) and insurance (up 2.9 per cent).

Fewer employees are planning to give workers a raise next year. Seventy per cent of respondents in the survey said they would, compared to 83 per cent in last year’s survey.

“This is due to continued economic uncertainty across many sectors in the Canadian economy and to the fact that more employers are now adopting a ‘wait and see’ position before increasing their budgets,” Hay Group said in a statement.

The survey forecasts notably stronger wage growth for the U.S. at 3 per cent overall.

“Canadians have now fallen further behind their U.S. counterparts,” it notes.

But despite the oil slump, the survey still sees Saskatchewan as the province with the highest average wage growth next year, at 2.7 per cent. Alberta, Ontario and Quebec are all forecast to see 2.5 per cent wage growth, while B.C. (2.3 per cent) and the Maritimes (1.9 per cent) bring up the rear.

Another survey released this week also predicts oil and gas workers will no longer lead in wage growth next year, but it has a different projection for who the wage winners will be.

The compensation planning survey from human resources firm Mercer predicts jobs in high tech will take the crown in 2016, with wage growth of 3 per cent. By comparison, it sees 2.9 per cent wage growth in the energy sector.

Allison Griffiths of Mercer told the Globe and Mail she couldn’t remember the last time the energy sector didn’t lead Canada in wage growth.

“But it’s not all [wage] freezes,” she noted. “They’re not having an increase of zero. They still are projecting some growth.”

For all sectors of the economy, Mercer sees 2.8 per cent wage growth next year.

It says 8 per cent of Canadian companies froze salaries this year, but only 3 per cent are currently planning to do the same next year.

The energy sector has had it worst, with 37 per cent of companies freezing salaries this year.

The Hay Group survey polled 525 public and private sector employers in June and July of this year. The Mercer survey covers nearly 700 organizations and reflects pay for non-unionized employees in five categories: : Executives, Managers, Professional (Sales and Non-Sales), Office/Clerical/Technical, and Trade/Production/Service.

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