Salary Trends

Salary Trends

Many Institute groups will be in negotiations in 2007. In preparation for bargaining, the Institute’s Research Section is responsible for monitoring and establishing compensation trends. In 2007, base salary increases are expected to average 3.4% to 3.9% for Canada. This is slightly above the average salary increase of 3.8% in 2006. For the broad public sector, increases are expected to average 3.6% to 4% in 2007. The tight labour market is affecting the public sector which has to develop innovative practices to attract, motivate and retain a broad range of talent.

The wage settlements for unionized workers are expected to average 3% in 2007. Unionized employees usually enjoy superior wage settlements and do not start from low numbers. The difference is also more pronounced when benefits are included.

The Consumer Price Index (CPI) is the measure used to assess if salaries are keeping pace with inflation. For the most part, private and public sector increases have been above the CPI (except for 2000 and 2003 for the private sector).

Statistics Canada provides a tool to measure the average salary of employees across the country. The Average Weekly Earnings (AWE) of payroll employees in Canada was $749.69 (seasonally adjusted) in September 2006. This leaves the year-to-date growth in earnings at 3.1%.

In Canada's largest industrial sectors, year-to-date earnings growth as of August was 3.9% for health and social assistance, 3.8% for educational services, 3.0% for retail trade, and 2.5% for manufacturing.

There were 14,099,100 payroll jobs in Canada in November, an increase of 336,900 employees (+2.4%) from November 2005. Provinces showing the largest percent increases in employment from November 2005 to November 2006 were Alberta (+6.4%), Saskatchewan (+3.8%), and Ontario (+0.9%). The lowest increase was in New Brunswick (+0.1%) and Prince Edward Island (-0.1%). Nationally, payroll employment has increased by approximately 170,000 jobs since the beginning of 2006.

Major Settlements for Unionized Employees

as at November 15, 2006

Human Resources and Social Development Canada (HRSDC) compiles the wage increase information for unionized employees. The following tables show the public and private sector comparison for major settlements (500 employees and more) by sector or by jurisdiction for the year 2006.

  Major Wage Settlements in 2006 -Canada 
  Number of Agreements Number of Employees Duration in Months Wage Adjustment
Private Sector 86 129,340 45.9 2.4 %
Public Sector 183 561,980 42.9 2.6 %
All Sectors 269 691,320 43.5 2.6 %
  Major Wage Settlements in 2006 -Other Jurisdictions 
  Number of Agreements Number of Employees Duration in Months Wage Adjustment
Atlantic Provinces 25 45,930 44.0 2.8 %
Québec 19 34,245 55.8 1.7 %
Ontario 85 152,905 38.7 2.8 %
Prairie Provinces 37 114,870 29.8 2.6 %
British Columbia 72 258,090 52.0 2.5 %
Three Terriroties 1 690 36.0 3.1 %
Multi-Province 3 8080 36.0 3.5 %

Major settlements are those involving bargaining units of 500 or more employees.

For additional information, please view the Technical Notes on the HRSDC Web site.

Source: Labour Policy and Workplace Information, HRSDC -Labour Program.

Salary TrendsWage Settlements Under Collective Agreements -Wage Increase per Sector

Factors Influencing Salary Increases

  • Tightness of the labour markets across the country;
  • Healthy economy and low unemployment rate across the country;
  • Side effects of the strong economy in Western Canada;
  • Variation of wages by industry and region;
  • Increasing problem of recruitment and retention;
  • Higher rate of turnover for the top performers;
  • Departures of baby boomers and shortage of talent.

Contributor: Jean-François Simard, Research Officer

Publish Date: 22-DEC-2006 10:01 AM

Copyright © The Professional Institute of the Public Service of Canada