Compensation Planning Outlook 2021: Pulse Check

Compensation Planning Outlook 2021: Pulse Check is based on responses from 217 organizations with operations in Canada. This data briefing summarizes the results of the Conference Board’s annual compensation survey and forecast.

Document Highlights

• The successful rollout of vaccines in Canada and around the world, and no resurgence of the coronavirus are key factors in the economy’s recovery of the coming years.
• As the economy continues down the road to recovery, organizations are revising projected salary increases. The average pay increase for non-unionized employees is forecast to be 1.9 per cent in 2021 – down from the 2.1 per cent projected in the summer.
• The majority (62 per cent) of Canadian employers are working with either recommended or approved salary budgets. Thirty-one per cent of organizations are planning a pay freeze for executive level employees and 16 per cent are planning a pay freeze across the organization.
• Short-term incentives did not pay out as planned in 2020, falling short across all employee groups for one-quarter of organizations. Nonetheless, organizations are holding steady with 2021 targets – roughly two-thirds are maintaining 2020 targets.
• The coming months will be trying for pay planners across Canada as they continue to face the challenge of offering affordable, competitive total rewards packages within a weakened growth climate and economic uncertainty.