OTTAWA (Reuters) - Canadian employers expect to raise salaries by roughly 3 percent next year, loosening their purse strings in the belief that the worst of the financial crisis is over, two surveys showed on Wednesday.
Wage freezes are seen as far less common in 2011 than in the previous two years and one survey also noted that executive pay hikes are becoming more modest, aligned with the rest of employees.
A survey by Mercer consulting services found employers plan average pay increases of 2.9 percent next year, after awarding an average 2.7 percent hike this year and 2.0 percent in 2009.
Workers in the oil and gas sector as well as in other resource industries are set to see the biggest gains, it said.
Preliminary findings from another survey by Aon Consulting showed companies are budgeting for pay increases of roughly 3 percent in 2011.
“Overall, the dampening impact on salaries caused by the 2009 economic crisis is subsiding. Most employers are expecting to be in a position to afford more aggressive salary increases than they have implemented in recent years,” Aon said in a release.
The practice of freezing salaries is on the way out too. Of the over 600 employers in Mercer’s survey, only 2 percent project an all-employee salary freeze for next year, down from 6 percent this year and 31 percent in 2009 at the height of the crisis.
Aon’s smaller sample of 184 organizations suggested 1 out of 25 employers would freeze wages next year, still a dramatic drop.
Historically, top executives have seen their paychecks grow faster than colleagues with lesser responsibilities. That trend now appears to be vanishing, at a time when big bailouts and banking collapses around the world have put executive compensation in the spotlight.
“Employers project similar increases for all categories of employees (executive, management, professional, trades and clerical) at either 2.8 or 2.9 per cent ... Recent years have seen increases for executives come into alignment with the rest of the employee population,” Mercer said.
Reporting by Louise Egan; editing by Rob Wilson