A report on Canadian technology sector compensation and policy data from more than 200 companies shows “balanced headcount growth for the sector and continued salary pressure in key jobs where skills shortages persist.”
The “2023 Tech Salary and Total Rewards Survey,” conducted by TAP Network in partnership with Mercer, concluded that the projected salary increase budget for 2024 is 4.3%.
This figure ranks below the 2023 actual salary increase budget of 4.5% and down from the 2022 high of 6.5%—although it is still higher than the preceding five-year average.
“Business performance was a key factor in setting 2023 salary increase budgets but so were inflation and employee retention,” stated Stephanie Hollingshead, CEO of TAP Network.
The salary bump is roughly in line with national inflation in Canada, which was pegged at 4% in August.
“The data is showing us that new hire pay pressure has reduced compared to 12 months ago, and is currently isolated to high demand roles and more senior or specialized positions,” Hollingshead continued. “Pay for new hires is still competitive and positioned similarly to those already in the role.”
“With this external pressure, companies are making targeted market and internal equity adjustments for existing employees,” she added.
The median salary increase for employees who stayed in the same position remained high, according to the data, indicating that organizations are still relying on off-cycle pay increases to address retention concerns, counteroffers, market adjustments and internal equity.
Skills identified as difficult-to-recruit across sub sectors included Leadership and Senior Level skills, Software and Application Developers, Full Stack Developer and Dev-Ops Developers.
The hottest jobs include software engineer, data scientist, and technical support. Interface designer, game designer, and electrical engineer also ranked in the 10 top list, which is based on year-over-year median base salary increases.
As for workplace trends, “Remote and hybrid work arrangements continue to dominate Canada’s tech sector,” says Hollingshead.
According to this year’s survey participants, “38% of companies are operating fully remotely and 42% are operating with hybrid work models,” she says.
This result reflects earlier Gartner data showing 80% of companies now operate some form of hybrid or remote work setting.
“People and Culture leaders are telling us that these flexible work arrangements are providing effective competitive advantages in attracting and retaining talent in roles where labour shortages persist,” the TAP CEO stated.
The seas ahead appear somewhat steady but many possible factors, such as the explosive spread of Generative AI, could shift the winds at any moment.