Salary increases for 2024: Canadian budget forecasts remain stable since summer

In late 2023, more than 430 organizations across Canada took part in Normandin Beaudry’s Salary Increase Pulse Survey.

As inflationary pressure slowly tapers off and the labour market begins to balance out, the survey sought to confirm the 2024 salary forecasts established by the organizations last summer.

Highlights

Results indicate that most organizations are planning to maintain their initial salary increase budget, with only 36 % of participating organizations reporting changes to their initial budget from last summer. For organizations planning changes to their initial budget, more than half intend to lower their salary increase budget, while the rest intend on increasing their initial budget. In Canada, the national average budget remains the same as the forecasts reported in the summer at 3.6 %, excluding wage freezes.

Beyond the traditional salary increase budget, 41 % of respondents in Canada have set aside an average of 0.9 % of payroll for additional budget funds. The primary intents of these additional budgets are to:

• Implement ad hoc market adjustments: 69 %
• Differentiate compensation for high performers: 52 %
• Retain strategic or mission-critical employees: 50 %

These results demonstrate that organizations are still making investments in their employees’ compensation package to remain competitive in today’s job market. Beyond compensation increases, a majority of participating organizations are looking toward their broader total rewards portfolio as a strategy for attraction and retention. In fact, 67 % of participants noted one of their main 2024 strategies was to ensure the competitiveness of their total rewards programs. Enhancing benefit and pension plans as well as non-monetary components for example, can help organizations stand out from competitors.

Salary increase budget by province

While it appears that annual salary increase budgets are beginning to stabilize, it’s important to note that 2024 forecasts remain above historical trends and current rates of inflation. The 2024 average forecast by province and territory is summarized below.

Salary structure increase forecasts

The average 2024 salary structure increase in Canada is now forecasted at 2.9%, excluding organizations that decided to freeze their salary structure, which is equal to last summer’s forecast.

Looking for more information about the 2024 Salary Increase Pulse Survey and its results? Contact your Normandin Beaudry consultant or email us.