: globeandmail.com Calgary wages rising at record paceSkip navigationEnter the city, then press Submit: ChangeCityHiLo Conditions across Canada Visit the weather page to get the latest temperatures. BusinessHome National British Columbia Prairies Ontario Quebec Atlantic Politics World Americas Europe Asia-Pacific Africa-Mideast Business & Investing Globe Investor Globe Fund Small Business Personal Finance Magazine Opinions Columnists Cartoon Editorials Letters to the Editor Sports Hockey Baseball Basketball Football Golf Others Arts Movies Television Theatre Music Books Style Technology @work @play Reviews Troubleshooter Travel Activities Destinations Health Science Auto POSTED AT 3:49 AM EDT ON 05/09/06 Print this article E-mail this article Comment Share this article Text Size Calgary wages rising at record pace Survey finds pay climbing faster than in any other city, with no signs of slowing CHANAKYA SETHI From Tuesday's Globe and Mail Wages in Calgary are climbing faster than in any other metropolitan centre in Canada and show no sign of letting up, according to a report released today by Hewitt Associates, a global human resources consulting firm. A survey by the company found that salaries in Calgary are growing at an all-time-high pace of 5.3 per cent this year and are projected to climb 5.2 per cent in 2007. Those figures are well above the national average of 3.6 per cent this year and 3.7 per cent in 2007. The findings are notable because they show a much wider margin between national wage figures and those for Alberta. Two other surveys released last week reported differences that amounted to less than a percentage point. Nevertheless, the survey indicates that the effects of wage increases are being acutely felt in Alberta and employers across the country are having to think about ways to cope. Related to this article Latest Comments Start a conversation on this story "There aren't many employers that can even begin to compete with the salary increases being offered in Calgary," said Keri Humber, senior compensation consultant at Hewitt. The challenge for those companies, he said, will be finding alternative means of compensating their workers. "Rather than increasing base salary, what they'll do is bring in variable pay programs," Mr. Humber said in an interview. "They aren't building fixed costs into their financial structure. What they're doing is saying 'we're going to link the pay of our individuals to the success of the organization.' " The proliferation of variable pay programs are part of a broader trend across the country -- especially in Alberta -- to attract and retain their employees in an increasingly tight job market, Mr. Humber said. Besides higher pay, flexible work options -- such as phased retirement, the chance to work from home and paid sabbaticals -- are also increasingly common. The wage boom, while at first glance a boon for employees, may actually be a double-edged sword. Some economists fear that as companies offer higher wages in order to stay competitive, they'll be forced to cut back on capital investments, in turn leading to slower overall economic growth. "Wages are going up, so people who are paid more are apparently doing better, but on the down side, owners of capital and companies seem to be in trouble," said Herb Emery, a professor of labour economics at the University of Calgary. "In a resource boom, what you're always going to see is that marginal employers
are going to get crowded out," he added, pointing to the high-tech sector and consumer products as examples. "Those companies are looking to leave because they're being crowded out. If they're an important sector, once the resource boom is over, the province is going to be in bad shape." There's also the question of how significant the wage gains are in terms of real wealth. While inflation national in July clocked in at 2.4 per cent on an annual basis, inflation in Alberta stood at 4.3 per cent -- the highest in the country, according to Statistics Canada. Given those figures, real wage gains, whether in Alberta or nationally, both amount to roughly 1 per cent this year. Pedro Antunes, director of national and provincial forecasts at the Conference Board of Canada, said although it's reasonable for people to worry about inflationary pressures, he's not concerned yet. "I think we have to be careful to look at short run versus long run," Mr. Antunes said. "There are some consequences in the short run," but in the long run, other factors -- like migration of workers to Alberta -- should mitigate that pressure. Print this article E-mail this article Leave the first comment Share this article SPONSORED LINKS Buy Stocks at $3 Buy stocks at $3 or less, real time and automated. No minimums. No catch. Free stock charts, quotes and research. http://www.sogoinvest.com Junior Copper Miner +Billion lbs.Cu/Au potential This TSX Venture-listed company recently drilled 337' of 1.3 gpt Gold and 1.2 % Copper. 43-101 Resource Calculation to be published in September. Mar... www.resourcexcopper.com Special Oil Opportunities You Can Trade Currencies That Benefit From Rising Oil Prices. www.fxcmtr.com Trade with FOREX.com Sign up for a free $25,000 practice account. Advanced trading platform with real-time quotes, charts, news, research. Mini accounts from $250. No ... www.forex.com Confused about Forex Trading? Open a Free Demo Free One-on-One Training and Demo Account. GFT offers you Commission-free trading and Award-winning, Easy-to-Use Software. Trade on over 60 currency ... http://www.gftforex.com Buy a link Now Search Search Archives Stock Profile Quote For an in-depth look at Canadian and U.S. stocks. Enter your stock symbol below. Lookup Elsewhere on this site Top Business Stories Bill Ford replaced as Ford CEO Auto firms enjoy best August sales on record Talisman Energy to sell Alberta oil sands assets Inco calls off Phelps Dodge merger Go to the Business section Business Columnists Rob Carrick: Your map to worldly investing Derek DeCloet: Telfer's Glamis gamble could pay off if doomsayers right about greenback
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