2025 SALARY INCREASES: BUDGETS SLOWLY DECLINING
INCREASES OF 3.4% FORECASTED FOR 2025
TORONTO, Sept. 4, 2024 /CNW/ - Normandin Beaudry, a leader in actuarial and total rewards consulting services, released the results of its 14th annual Salary Increase Survey with more than 750 Canadian organizations participating in this 2025 edition. Results indicate that Canadian organizations are slowly reducing their budgets for overall salary increases, with an average increase of 3.4% expected in 2025 excluding salary freezes -- a 0.2% reduction from 2024.
"While economic pressures and the competition for talent remain challenging, we're beginning to see a gradual return to pre-pandemic market norms as salary increase budgets reduce for a second year in a row," said Darcy Clark, Senior Principal, Compensation at Normandin Beaudry.
HIGHLIGHTS
Additional salary budgets are still in play to support compensation issues
As salary increase budgets slowly revert to more typical norms, organizations continue to carve out an additional budget to address any pressures that may arise due to labour shortages or economic circumstances. In 2024, approximately 50% of responding organizations allocated an additional budget averaging 1.0% beyond their general salary increase budget. Normandin Beaudry's survey results indicate that this trend remains, as 44% of Canadian organizations plan on granting the same average additional budget of 1.0% for the 2025 compensation cycle. Among other purposes, these budgets will be used to apply market-driven adjustments, retain employees in critical roles, and differentiate compensation for top performers.
Industry sectors forecasting high increases
For 2025, the following industry sectors reported higher-than-average salary budget increase expectations:
- High-tech: 4.3%
- Telecommunications, data processing, data warehousing and related services: 3.9%
- Professional, scientific and technical services: 3.7%
- Construction: 3.6%
- Computer design, security, IT services and AI: 3.6%
- IT consulting services: 3.5%
- Energy, mining and metals: 3.5%
- Foundations, community assistance and health care: 3.5%
The results of the Salary Increase Survey indicate that, as the labour market continues to balance out and inflationary pressures ease, organizations are feeling less pressure and taking a more conservative approach to managing their compensation spend. "While average salary increase projections remain above 3%, organizations are considering affordability when defining their long-term plans. Several significant salary increase cycles may not be sustainable and organizations remain cautious about increasing recurring payroll costs as they plan for the future," concluded Clark.
The interactive tool, with details by province, industry sector, type of organization and company size, among other data, is available here.
About Normandin Beaudry
Founded in 1992, Normandin Beaudry is a leader in actuarial and total rewards consulting services with offices in Montreal, Toronto and Quebec City. Its team of over 350 people serves clients across Canada in various areas of total rewards expertise: Pension, Savings, Investment Consulting, Pension Plan Administration, Group Benefits, Compensation, Health, Performance and Communication.
In 2023, Normandin Beaudry enhanced its global presence by becoming an equal shareholder of MBWL International, a joint venture between Milliman, Barnett Waddingham and Lurse, while maintaining its independent status.
About our Compensation Expertise
Normandin Beaudry's team of over 40 Compensation consultants is the largest in Canada. Through the sound and innovative use of data and technology, our versatile and creative experts provide clients with unique and simple solutions that address their strategic and operational needs. For more details, visit https://www.normandin-beaudry.ca/en/areas-of-expertise/compensation/
SOURCE Normandin Beaudry
Media contact: Zenergy Communications, [email protected]
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