B.C. tech pay rises while other industries face freezes and cuts: HR Tech Group

September 17, 2020

Canada, Toronto

The economic dislocation caused by the COVID-19 pandemic is being felt across B.C.’s economy – but a rare exception is the high-tech sector, according to the 2020 HR Tech Group Salary Survey, conducted in partnership with Mercer Canada.

The Survey, which includes data from 150 companies with employees in B.C. 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%. 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%. 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%.

“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

According to the 150 companies that participated in the 2020 survey, the most difficult to recruit skills are Software Development, followed by Dev Ops Engineers. Leadership positions are the third most difficult to recruit, with 27% of respondents indicating difficulty hiring.

HR Tech Group Survey 2020: Top 5 Most Difficult To Recruit Jobs

Percent of companies that participated in the HR Tech Group Salary Survey that identified the job or discipline as difficult to recruit.

Incumbent employees enjoy increased bargaining power

Tech professionals who have chosen to stay with their present employer are being rewarded with salary increases, reflecting the increased demand for their talent and employers seeking to retain top talent.  Web Developers and Recruiters were able to command year-over-year salary increases of over 10%, with Implementation Managers and Sales Operations Managers not far behind:

HR Tech Group Survey 2020: Top 10 Fastest Moving Jobs

Same employees in the same job from 2019 to 2020 reported in the HR Tech Group Compensation Survey. Jobs with a minimum of 10 organizations matching each year.

Higher pay for new recruits

Despite the market power commanded by incumbent employees, top tech talent is so scarce it is creating a gap between the pay negotiated by new hires, and the pay of incumbent employees.

Cloud Ops Engineers top this list at nearly a 10% premium over incumbents:

HR Tech Group 2020: Fastest Moving Pay

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.

“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.”

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%, with salary freezes being reported by many companies.

About the HR Tech Group Salary Survey

The HR Tech Group Salary Survey is conducted by Mercer.  Survey submissions were collected during Spring 2020 and results were published in August 2020. The survey serves companies with employees in BC and Alberta.

In 2020, 150 companies participated to report 206 jobs for 22,450 employees.

Survey participation has increased by 10.7% from 2019. Since 2017, the survey has increased participation by 23%.

The survey covers nine industry sectors that share and compete for high tech and technology talent.

In 2020, the survey expanded to Alberta based on demand.

About Mercer’s Canada Compensation Planning Survey

This survey, aimed at supporting compensation planning decisions typically runs once a year. During 2020 in response to COVID-19, Mercer’s Compensation Planning Survey has run as a series of brief monthly polls. Over 200 companies across industries, provinces and territories participate each month. This survey is free for participating organizations.

About HR Tech Group

HR Tech Group is an association of human resources professionals employed in B.C. and Alberta tech companies. The group produces the leading BC Tech Salary Survey and provides new and benchmark data that keeps members up to speed on local business practices in tech. HR Tech Group serves over 150 mid to large member companies in all tech sectors, including ICT, film/ VFX, digital media, cleantech and life sciences.

About Mercer
Mercer believes in building brighter futures by redefining the world of work, reshaping retirement and investment outcomes, and unlocking real health and well-being. Mercer’s approximately 25,000 employees are based in 43 countries and the firm operates in 130 countries. Mercer is a business of Marsh McLennan (NYSE: MMC), the world’s leading professional services firm in the areas of risk, strategy and people, with 83,000 colleagues and annual revenue of nearly $20 billion. Through its market-leading businesses including Marsh, Guy Carpenter and Oliver Wyman, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment. For more information, visit mercer.ca. Follow Mercer on LinkedIn and Twitter.