BRITISH COLUMBIA – According to the HR Tech Group, the economic dislocation caused by the COVID-19 pandemic is being felt across BC’s economy – but a rare exception is the high-tech sector, as reported in the 2020 HR Tech Group Salary Survey, conducted in partnership with Mercer Canada.
The Survey, which includes data from 150 companies with employees in BC and Alberta, found that although COVID-19 has caused significant disruption to Canada’s economy, many tech companies are experiencing a boom in demand as much of the economy moves online.
This is reflected in salary increase data, as out of all of Canada, tech companies are planning to increase their total salary budgets by the greatest amount.
The planned salary budget increase is the total amount of money allocated to increase base salaries for employees each year. This pot of money is typically distributed based on individual performance, company performance, and other factors, such as the market demand for specific skills or capabilities.
High Demand For Top Tech Talent
As demand for technology services soars, tech talent is in high demand, with key roles both difficult to recruit and commanding higher and higher premiums.
“Although the times are challenging in many industries, top talent continues to be in demand,” says Liz Elliott, a Principal at Mercer Canada and senior advisor to the HR Tech Group Salary Survey. “Tech companies, like all companies, need to stay abreast of market compensation for their employees, to increase retention and employee satisfaction.”
When the data was collected in May and June, participating companies reported their actual 2020 average total salary increase budgets at 3.3 per cent. This is the average budget that would disperse across the entire company. High tech jobs are being allocated higher proportions of these budgets than other types of jobs. Year over year, for the same incumbents submitted to the jobs within the HR Tech Group Survey during 2019 and 2020, the median salary change was 3.5 per cent. At the entry level, which is typically employees with 1 – 2 years of experience, the year over year median salary change was highest at 5 per cent.
“Despite a global pandemic, BC and Alberta tech companies are projecting double digit headcount growth for both 2020 and 2021, and tech compensation markets are showing no signs of slowing down,” says Stephanie Hollingshead, CEO of HR Tech Group. “Organizations that want to stay competitive need to understand what competitive compensation looks like.”
Most Difficult To Recruit Jobs
Incumbent Employees Enjoy Increased Bargaining Power
Higher Pay For New Recruits
The pay disparity between incumbent and new employees was a challenge for many firms in 2019; a gap that they have spent the last year looking to close. Accordingly, this year’s results show a smaller gap, as employers look to ensure their incumbent employees are paid at fair market rate.
A National Trend
In a separate survey, Mercer Canada confirmed that this trend extends beyond BC to all of Canada’s growing high-tech industry.
The Mercer Canada Compensation Planning Survey has polled companies in all industries across Canada monthly since the beginning of COVID-19. For the second year in a row, Mercer’s Survey has reported high tech annual salary budgets as among the highest among all other industries.
The salary increases projected for technology stand in stark contrast to industry sectors that have been hard hit. According to Mercer’s Survey, energy and retail are projecting average salary increases around 1 per cent, with salary freezes being reported by many companies.