PayScale Study Points North: Average Pay in Canada Up

By Bridget Quigg

It’s time that PayScale admits it. We have found out more glowing facts about Canada. After humbly complimenting our neighbors to the north when they won gold in men’s hockey (beating the US) back in 2010, and congratulating them on a great run in the NHL playoffs, we now have another achievement to recognize: rising wages.

It turns out that, according to PayScale’s recent review of Canadian national pay trends, private workers in Canada saw less of a wage drop than the US during 2008 and 2009, the lowest point in the global recession, and are now seeing earnings increases across-the-board that outpace those for US workers. Canada, we salute you.

Welcome to The PayScale Index, Canada!

For the first time since its inception in the fall of 2010, The PayScale Index is publishing national average compensation trends for Canada. In the future, coverage of Canada will include more specific metrics, like cities and industries, but PayScale is dipping its toes in the water with a national study, first.

“We are starting with a national view. And, as we are confident we have the right amount and type of data, we’ll drill down to closer looks at major cities and common industries,” says Al Lee, PayScale’s director of quantitative analysis and the lead on the study.

What Is The PayScale Index?

Most simply put, The PayScale Index tracks quarterly compensation trends. It is a bit more complicated than that, though, once you look at the details. The PayScale Index tracks changes in total cash compensation for full-time, private industry employees. The PayScale Index has not been adjusted for inflation and is based on actual wages. For example, it includes bonuses but excludes non-cash benefits or equity (stock), focusing only on cash earnings.

What Did We Learn?

Canada is doing something right. The worldwide global recession definitely hit Canadian workers’ pocketbooks, but not nearly as dramatically as it did for workers in the US. And, wage recovery came much more quickly in Canada.

During the recession, US workers suffered wages dropping, on average nationally, nearly a percent and a half, between 2008 and 2009. And, wages have recovered very little in the 50 states, leaving them, roughly, where they were in the beginning of 2008.

By comparison, Canadian workers’ earnings fell one percent between late 2008 and early 2010, and then quickly went charging upwards, rising above their peak in 2008 and continuing up through 2011.

Al Lee says, “What comes next for Canadian wages? Who knows, but the trend is looking like a fairly swift recovery from a typical recession.” Lee noted that the balance between available labor and demand will continue to shift, hopefully for the best for Canadian workers.

Lee’s final thought: “Perhaps Canadian companies are less greedy and more willing to share rising profits with their workers than US employers are.”

Someone else will need to do that study. For now, check out The PayScale Index (Canada).

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