2026 Salary Forecasts: Aligning Expectations for Greater Organizational Performance

After several years marked by high inflation and wage increases exceeding historical averages, the Canadian economy appears to have narrowly avoided a recession. However, household uncertainty about the economy remains high, fueled by global instability, the potential for new U.S. policy announcements, and low economic confidence in Quebec¹.

The growth forecast for 2025-2026 remains modest, and the labour market is gradually rebalancing.

Unemployment is on the rise, and job vacancy rates are declining², resulting in reduced workforce mobility. The “Great Resignation” seen after the pandemic now appears to be behind us.

Despite this context, organizations are showing resilience by maintaining significant salary increase budgets. However, we are seeing a return to levels closer to historical averages—a sign that compensation practices are being realigned. With increasing pressure on productivity, companies are being called to better target their compensation investments, aligning them with value creation and organizational performance.

Our Total Rewards Survey in Quebec, conducted with 450 participating organizations, allows us to paint a clear and up-to-date picture of market trends³ :

• Increase in salary structures (excluding salary freezes): 2.5%
• Total rewards increase (excluding salary freezes): 3.1%

It is important to remember that, in recent years, many organizations have granted substantial increases to cope with inflation and labour market pressures. This exceptional period has contributed to creating high expectations among employees, who often hope that this trend will continue.

However, current economic conditions no longer justify these levels of increases. That is why it is necessary to proactively manage employee expectations by focusing on clear communication.

A major challenge in the coming years will be helping employees adjust their salary expectations.

The significant increases granted recently responded to an exceptional situation, which combined high inflation, labour shortages, and unprecedented market pressures. This period is no longer the norm, and organizations must now deal with a different reality.

The ability to sustain continuous increases will need to be linked to productivity growth, which remains a major obstacle in Quebec compared to other industrialized countries⁴. Without real efficiency gains, maintaining the pace of recent years is unrealistic.

A new balance is therefore taking shape between employers and employees. The employment relationship increasingly relies on the following elements:

• Competitive and fair compensation
• Concrete opportunities for skills development and career progression
• Investments in technologies (including artificial intelligence), processes, tools, and management practices that enable more efficient work

The way forward is clear: improve productivity, optimize processes, train teams, and implement total rewards programs that are consistent with business objectives.

It is this combination that will enable organizations to remain competitive while establishing a sustainable compensation model aligned with their reality.

Organizations are at a crossroads. The significant salary increases of recent years addressed an urgent need, but they cannot become the norm.

The real challenge now is to build a model that attracts and retains talent differently – that is, through competitive compensation, but also through growth opportunities, an engaging environment, and management focused on collective productivity.

Total rewards is no longer just a retention tool; it is becoming a strategic lever to align organizational performance with individual growth.

In other words, it’s not just about paying more, it’s about paying smarter, in direct connection with the value created.

<sup>1. Reference in French only : Benoit Durocher, Desjardins au Rendez-vous Rémunération, CRHA – Prévisions économique, 23 septembre 2025.
2. Reference in French only : Pierre Emmanuel Paradis, AppEco au Rendez-vous Rémunération, CRHA – Prévisions salariales 2026, 23 septembre 2025.
3. Total Rewards Survey in Quebec by Solertia, 2025.
4. Reference in French only : Jonathan Deslauriers, Robert Gagné et Jonathan Paré, Productivité et prospérité au Québec – Bilan édition 2025, Centre sur la productivité et la prospérité – Fondation Walter J. Somers HEC Montréal, mai 2025, PP-2024-01.pdf</sup>