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2006 salary increases: Marked differences among industries
8 September 2005Canadian companies are planning widely diverging
salary increases for 2006 depending on the health of their particular
industry. Salary increase budgets will vary between 4.6% in the mining, oil
and gas sector and 2.6% in the paper or wood product manufacturing sector,
according to the results of Morneau Sobeco's 2006 Compensation Trends and
Projections Survey.
Overall, in 2006, average salaries are expected to increase 3.2%,
excluding provision for promotional increases. Additional provision for
promotional increases and special adjustments is made by 54% of the
participating companies with the median provision being 1.0% of payroll.
Average expected salary increases for 2006 vary from 2.7% for unionized
hourly employees to 3.3% for executives, which is marginally bigger than the
corresponding increases for 2005.
"Our annual survey also highlights emerging trends in Canadian employers'
practices pertaining to compensation, group insurance and pension benefits,"
says Bill Morneau, President and CEO of Morneau Sobeco. "An interesting
feature of this year's survey shows the continuing trend for employers to
embrace on-line approaches for the delivery of pension and benefits
information to employees."
According to the survey, there has been a dramatic increase, over the
last four years, in the use of the Internet to communicate employee benefits
with 58% of employers utilizing Web sites, up from 30% in 2001. Web sites are
also becoming increasingly dynamic and interactive as 46% of employers are now
offering retirement and financial planning pension tools through the Internet,
up from 19% in 2001.
The 2006 Compensation Trends and Projections Survey is based on data
collected across Canada from June to August 2005 from over 300 participating
organizations, representing more than 800,000 employees. Morneau Sobeco has
been conducting this annual survey since 1982.
The top three benefit issues for 2006 are health care costs (as indicated
by 58% of employers), disability management (35%) and benefits plan design
(30%). The survey indicates that employers will continue to put a high
priority on initiatives to manage the cost of health care and disability
programs including reviews of disability management practices.
"The survey also shows that Employee Assistance Programs have become
almost universal," comments André Sauvé, Partner in charge of Morneau Sobeco's
Compensation Consulting Practice. The survey illustrates that 85% of employers
currently sponsor such programs, up from 72% in 2001. Wellness programs are
also becoming more popular as 33% of employers are offering some programs, up
from 24% in 2001.
Given the deficits accumulated by defined benefit pension plans over the
last few years, it is not surprising that investment performance and pension
costs will continue to be the key pension issues for employers in 2006.
Further, with the aging of the population, retirement planning is an
increasingly important issue, as mentioned by 20% of participating employers.
"Employers are now realizing the importance and added-value of retirement
planning and financial planning tools," concludes Mr. Sauvé.
Morneau Sobeco is the largest Canadian-owned pension and benefits
consulting and outsourcing firm, providing services to organizations across
Canada and in the United States. We employ approximately 950 professionals and
support staff in 11 cities across North America.
For further information: please contact: André Pinsonneault, Manager,
Corporate Communications, Tel: (416) 383-6499, E-mail:
apinsonneault@morneausobeco.com
Source: NewsWire
All trademarks and copyrighted information contained herein are the property of their respective owners.
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