The Voice - Summer 2021 - 42

ONTARIO ENGINEERING ACADEMY
industry, operating model, and ability to react, many were still
unsure what the impact to compensation would be for this year.
In March, 81% of survey participants indicated moderate
to low impact on their financials due to COVID-19. So, how
will they carry out implementing merit and total increases?
Moreover, what about the 18% that indicated a high impact to
their financials?
Companies were cautious in
forecasting
As of early November 2020, Mercer's Canada Compensation
Planning Survey reported that organizations, which are planning
to give merit increases in 2021, were projecting average salary
budgets of 2.4%, compared to budgets of 2.6% for 2020. However,
taking into account the 13% that indicated they either will not
give a merit increase this cycle or will freeze salaries, the average
budget increase drops significantly, to 1.9% for merit increases
and 2.3% for total increases.
When we collected actual increase information in March of
2021, fortunately, the overall average increases were at or above
what was projected at the end of 2020 - 2.1% for merit and 2.3% for
overall increases, even including those that did not give increases.
However, there is significant variation by industry. Energy was
significantly lower than the overall average at 1.2% for both
merit and total increases when included those that didn't provide
increases. Mining & Metals however was significantly stronger
financially and delivered 2.5% merit increases and 2.8% in total
increases this year.
Incentives, payout,
and planning
Many of us wondered just how companies would address financial
shortfalls that would drive lower short-term incentive (STI)
payments for the 2020 performance year. According to our
Canadian Compensation Planning Pulse survey for March 2021,
32% of companies that have short-term incentives stated they
paid above target, while another 34% indicated they paid at target.
Adjusting to a new way of life and work has definitely forced
companies and employees alike to innovate and collaborate in
ways we never thought would take root so quickly. One bright
spot from how organizations handled the pandemic was that
it was clear that they realize the significance of decisions they
make that impact their most critical resource-their people.
The caution and care that employers have exhibited during this
pandemic is in stark contrast to some of the swift actions we saw
during the economic downturn of 2008 and 2009. Clearly, many
42
THE VOICE June 2021
of the circumstances were different, but a significant lesson
was learned about the relationship between a company's future
ability to recover based on the immediate actions they take
concerning their workforce.
As we move further into 2021, with hope and optimism, the
full impact of the continuing pandemic may yet to be realized.
For more information and for access to our library of common
corporate responses to the challenges of COVID-19, visit
imercer.com.
Elizabeth English is a Principal in Mercer's Careers Products
business in Toronto. She is the relationship manager for many of
Mercer's compensation surveys, including the Canadian Mercer
Benchmark Database, Canada Retail, the National Municipal
Compensation Survey and the North American Compensation
Planning Surveys. Elizabeth has over ten years of experience in
managing compensation surveys and consulting with clients on
a range of compensation projects, including: organization-wide
market competitive reviews, implementation of job evaluation
systems, base pay management programs, and custom survey
development and delivery.
About Mercer's Canada Compensation
Planning Survey
This survey collects data for all employee groups
and all industries across Canada. In 2021, Mercer
will conduct three pulse surveys taking place in
March, August and November.
For more information about Mercer Compensation
Surveys, visit imercer.com
In 2021, the Mercer OSPE National Engineering
Survey will merge with the Engineering and
Design Module within the Mercer Benchmark
Database (MBD). The survey opens March 1
and will close on May 28. Find out more about
Mercer's Engineering Compensation Surveys.
http://www.imercer.com http://www.imercer.com
The Voice - Summer 2021

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