Canadian salaries are projected to rise by 3.11% in 2026
Despite mounting uncertainty in Canada’s economic outlook, organizations are signaling stability in their compensation plans, according to two new surveys released this week.
The Conference Board of Canada’s Compensation Planning Outlook shows that while confidence remains fragile, organizations are still preparing for modest salary increases.
The average salary band rose 2.8% this year, and employers expect a similar 2.7% increase in 2026.
However, the report underscores how economic headwinds are weighing on workforce expansion: employment growth is projected at just 0.2% for the second half of 2025 and 0.3% in 2026.
“The largest share of organizations – 46.7% – expect business conditions to remain unchanged in 2026 compared to 2025, while only 5.6% foresee deterioration,” the Conference Board stated.
Yet, more than 60% of employers anticipate facing either an economic downturn or fallout from Canada–U.S. tensions.
Higher salary growth projected
Meanwhile, TELUS Health’s 43rd annual Salary Projection Survey projects a slightly more optimistic outlook for non-unionized Canadian workers, with average base-salary growth expected at 3.11% in 2026.
Regional and sectoral differences also stand out in the projections. Manitoba leads provinces with a 3.43% increase in average base salaries for 2026, followed by New Brunswick at 3.25% — the only province to record growth in its salary increase rate over 2025 — and Quebec at 3.21%.
By contrast, Saskatchewan lags at 2.95%, not only the lowest among provinces with statistically significant results but also registering the steepest decline from 2025.
Sector-specific forecasts reflect similar divergences: High Technology (3.64%), Oil & Gas (3.58%) and Life Sciences (3.39%) top the list of industries with the highest projected increases, while Business Services trails at just 2.60%. Information Technology shows the sharpest rebound, with salary growth jumping 0.51 points to 3.25%, whereas Real Estate faces the largest drop, falling 1.03 points from last year to match IT’s 3.25% projection.
Though this marks the third straight year of easing projections, it represents real wage growth when measured against the 1.9% inflation rate announced earlier this week.
“This still translates to continued purchasing-power recovery for Canadian employees,” TELUS Health noted in its media release.
The survey also highlights a shift in employer priorities: more than three-quarters (77%) of organizations are exploring artificial intelligence to boost productivity, while over half continue to provide short-term incentive pay.
Beyond base salaries, TELUS Health found that employers are increasingly leaning on total-rewards strategies to strengthen retention. Flexible benefits, mental-health supports and financial coaching are expected to play a larger role in compensation packages going forward.
Employers are holding steady on pay raises while preparing for potential economic turbulence. At the same time, they are responding to workforce expectations around transparency and fairness: according to the Conference Board, 87.7% of organizations have implemented some form of public-facing pay transparency and nearly 70% conduct pay equity assessments.
