Nearing the completion of its data harvesting period, Aon Canada’s annual Pay Increase Survey shows strong signs that organizations are slowing down on freezing salaries. Among the 184 organizations surveyed to date, only 1 out of 25 participants expect to freeze salaries in 2011. This is a dramatic difference from previous years when 1 out of 6 respondents implemented salary freezes in 2010 compared to 1 out of 3 in 2009 (see details www.aon.ca/surveys/rr/Aug-RapidReady.pdf).
Overall, the dampening impact on salaries caused by the 2009 economic crisis is subsiding. Most employers are expecting to be in a position to afford more aggressive salary increases than they have implemented in recent years.
Initial data is indicating that organizations are earmarking higher salary increases than in 2010. Aon Consulting’s projections indicate that salary increase budgets will be approximately 3 per cent of payroll in 2011. In recent years organizations have overall remained cautious with salary increases. Aon’s preliminary survey results indicate that organizations allocated a salary increase budget of 2.5 per cent in 2010. In addition, organizations are holding salary structure increases steady at 2 per cent.
“While these are preliminary results, it nonetheless reflects an overriding upward momentum among Canadian organizations with respect to annual employee pay increases,” notes Scott Bunker, national leader of the firm’s Human Capital practice. “We look forward to sharing our final analysis in the fall, along with any knowledge and insights that will complement data regarding the evolving total rewards landscape.”
Source : AON News Release
