Normandin Beaudry, a leader in actuarial and total rewards consulting services, released the results of its 14th annual Salary Increase Survey with more than 750 Canadian organizations participating in this 2025 edition. Results indicate that Canadian organizations are slowly reducing their budgets for overall salary increases, with an average increase of 3.4% expected in 2025 excluding salary freezes — a 0.2% reduction from 2024.
“While economic pressures and the competition for talent remain challenging, we’re beginning to see a gradual return to pre-pandemic market norms as salary increase budgets reduce for a second year in a row,” said Darcy Clark , Senior Principal, Compensation at Normandin Beaudry.
HIGHLIGHTS
Additional salary budgets are still in play to support compensation issues
As salary increase budgets slowly revert to more typical norms, organizations continue to carve out an additional budget to address any pressures that may arise due to labour shortages or economic circumstances. In 2024, approximately 50% of responding organizations allocated an additional budget averaging 1.0% beyond their general salary increase budget. Normandin Beaudry’s survey results indicate that this trend remains, as 44% of Canadian organizations plan on granting the same average additional budget of 1.0% for the 2025 compensation cycle. Among other purposes, these budgets will be used to apply market-driven adjustments, retain employees in critical roles, and differentiate compensation for top performers.