Canadian HR Reporter

December 2020 CAN

Canadian HR Reporter is the national journal of human resource management. It features the latest workplace news, HR best practices, employment law commentary and tools and tips for employers to get the most out of their workforce.

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Page 2 of 55 3 the circumstances that your organization is in, and how severely you've been impacted by the pandemic." By sector, salary projections for 2021 are highest among Crown corporations, at 2.5 per cent, followed by public and private sector organizations, both projecting increases of 2.2 per cent, finds the Conference Board. Industries that lend themselves well to remote work, such as financial professional services, saw minimal job losses and are recovering quickly, while those that shut down for short periods, such as tourism and recreation, will be much slower to recover, says Cowan. "The story here is really it's a vastly different experience, depending what industry you're in, and where you are in the country." And, as of October, roughly half of employers haven't decided on their salary budgets for 2021, says Gail Evans, president of the Wynford Group in Calgary. " Those that are [decided] are continuing or are still in that two-per- cent range, maybe a little bit less in Alberta — I think the number that keeps coming up is about 1.7 [per cent]. But I think there's a lot of uncertainty, and there's a lot of people using some of those work-share programs and things like that to try and keep people employed." Variation by region, industry The Wynford Group survey also found 2020 base salary adjustments averaged -1.5 per cent and varied considerably by industry, ranging from 2.4 per cent for utility/telecom, 2.1 per cent for IT services and 2.08 per cent for financial services to -8.44 per cent for energy/energy services, -7.5 per cent for construction and negative two per cent for manufacturing. The compensation increases vary widely by region and industry, unlike last year where there was almost no variation by region across Canada, with a solid 2.7 per cent to 2.8 per cent across the board, says Frost. "This year is really all over the map." Industries such as high tech and ecommerce are planning higher increases as they're "booming," he says, while the lower end is seen in sectors such as energy in Alberta or anything that's related to travel, tourism and transportation, such as airlines, hotels and restaurants. "They've obviously been impacted the worst by the pandemic," says Frost. "It really is interesting how it's almost at the sub-segment level or company by company. And it really does depend on The Morneau Shepell survey found that 42 per cent of employers in arts, entertainment and recreation and 25 per cent of employers in educational services have committed to freezing salaries in 2021, while those performing well and not planning to freeze salaries include 58 per cent of employers in real estate, rental and leasing, 57 per cent of employers in utilities, 56 per cent of employers in agriculture, forestry, fishing and hunting and 51 per cent of employers in finance and insurance. "Industries that rely on in-person activities and so forth, they're going to be more negatively impacted," says Parsan. "And then you have the other side of the coin, where organizations in other industries such as real estate or utilities, agriculture and finance, they held their ground pretty well, all showing in the 50s in terms of percentage of organizations not planning to freeze." There were a lot of rollbacks this year, particularly in the energy sector, but also in construction, retail and the hospitality sector, "which has been just decimated," says Evans. "The areas that were not affected very much were software development, utilities, IT services. IT services are probably even more in demand than ever, and financial services." Provincially, New Brunswick and Quebec look strongest for next year, at 2.3 per cent, followed by British Columbia, Saskatchewan, Ontario, Nova Scotia, Prince Edward Island and Newfoundland and Labrador at 2.2 per cent, Manitoba at 2.1 per cent, Northern Canada at two per cent and Alberta at 1.7 per cent, according to the Conference Board. "Alberta is really feeling the brunt of this… This province, of course, was hit SALARY FREEZES DRAMATICALLY RISE "A lot of organizations are in survival mode so they're trying to be equal in terms of how they treat everyone with respect to increases and freezes." Anand Parsan, Morneau Shepell hard both by COVID-19 shutdowns and disruption in the energy sector. Other provinces in Canada are closer to the national average." Sixteen per cent of employers in Alberta are expecting more salary freezes, more than any other province, driven in large part by a dramatic decline in commodity prices, says Parsan. Meanwhile, Atlantic Canada is looking relatively stable for 2021, with eight per cent of employers in New Brunswick expecting salary freezes, followed by nine per cent of employers both in Nova Scotia and in Newfoundland and Labrador and 10 per cent in Prince Edward Island. "It's interesting to note that, on the East Coast, it seems where they've had that pandemic bubble and this restricted travel across Canada and so forth, provinces like New Brunswick are showing 2.1 per cent [salary increases], which is tied for the highest with Quebec, including salary freezes. And then the other is Nova Scotia and Prince Edward Island, and Newfoundland and Labrador — two per cent all across the board. So quite robust numbers," he says. 2% Number of Canadian organizations forecasting salary freezes before the pandemic 36% Number of Canadian organizations that froze salaries in 2020 13% Number of Canadian organizations committed to forecasting salary freezes for 2021 Source: Morneau Shepell Alberta has been particularly hard hit by COVID-19 shutdowns and disruption in the energy sector.

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