Results of the 2023 Canada New Graduate Pay and Generation Z Compensation Survey

Hiring young talent is crucial for any business that wants to stay competitive. LinkedIn says hiring workers early in their careers can help companies build a stronger, more adaptable workforce. This is because young workers come with fresh perspectives and are more receptive to learning new processes and skills.

Hiring new talent is exciting, but if you are still using many traditional hiring practices and compensation strategies you may be left wondering why you can’t attract many young workers. Businesses must adapt to the shifting preferences and job perks that Gen Z finds the most appealing and valuable.

What perks does Gen Z want in the workplace?

Workplace perks have long been a valuable resource for attracting and retaining talent. However, as generations come and go, the perks your employees want will change. With Gen Z, it’s more than just good pay. 

Here are some popular workplace perks currently offered by Canadian organizations:

• Culture: Compensation/competitive pay, challenging and rewarding work, recognition programs, respectful sharing of ideas and opinions, and career development programs
• Comfort: Standing workstations, comfort/privacy rooms, break area activities, free snacks, and paid fitness/gym memberships
• Personal: Maternity/paternity leave, flexible remote work/work from home, tolerance of facial hair, relaxed dress code, and tolerance of fashion hair colors/tattoos/piercings
• Social: Organized community service efforts, participation in corporate challenges, philanthropic giving programs, paid leave for volunteering, and regularly sponsored networking opportunities
•  Amenity: Local business discounts, on-site fitness facilities, paid/subsidized parking, technology discounts, and travel discounts

Based on the needs of their workers, many organizations are considering adding more workplace perks that would be appealing to Gen Z, including additional vacation days, more remote work opportunities, student loan repayment assistance, and birthday rewards.

Average new graduate pay in Canada

New graduate pay in Canada continues to grow. The average starting salary for those with a community college diploma is $61,357. The average starting salary for those with a Bachelor of Science is $67,899. The highest paid new graduate hires are those with a Master of Engineering degree. The average starting salary in that category is $79,161.

The 2023 Canada New Graduate Pay and Generation Z Compensation Survey breaks down starting salaries even more, where you can view by specific geographic regions, degree levels, and disciplines (accounting, biology, engineering, etc.). 

Bonuses are still being offered

Annual bonuses are still a popular source of additional compensation for new hires. In our survey, 69.9% of businesses make new graduate hires eligible for their annual bonus program. Regarding payout, just over 80% of those businesses provide a bonus to 75% of new hires. Given that bonuses tend to be based on performance, it seems that new graduate hires are treated similarly to other employees.

While the job market has evened out in the last year, there are still highly competitive positions and in-demand jobs. In those areas, some businesses are using sign-on bonuses to attract the talent they need (23.2%). Of those who offered sign-on bonuses, 68.8% said they offered the bonus to compete with other offers and to pay for an in-demand skill.

Recruiting new graduates

Many businesses actively recruit interns, co-op students, and new graduates by visiting university campuses. In the 2023 Mercer survey, 89.4% of respondents said they would send recruiters to campuses this year. The most popular months for campus recruitment of new graduates include September, October, and April.

Some businesses are hiring more new graduates than before. The 2023 Mercer survey shows that 23.4% of organizations hired more recent graduates, while 50.6% reported no change.

Attracting interns and co-op students

Along with new graduates, many businesses also hire interns and co-op students to enhance their workforce. This is beneficial for both the business and students. The students gain valuable on-the-job experience, while companies are able to teach relevant processes to a new generation.

Pay transparency and flexibility crucial to attracting Gen Z workers

While we suspect older employees would apply to a job based on its description or the company’s reputation, many Gen Z workers need more information before they are willing to apply. One study found that 85% of young workers were less likely to apply for a job if it didn’t include the pay range.

The pay transparency trend is quickly gaining traction. In the 2023 Canada New Graduate Pay and Generation Z Compensation Survey, 31% of businesses offer pay transparency to new graduate hires.

The pay transparency policy may include such features as:

• Communication of the job’s pay grade
• Ability to see pay structure and ranges
• Pay ranges posted internally and visible to all employees
• Range provided in the job description

Another appealing workplace policy for many young people is the ability to work remotely/from home at least some of the time. In Mercer’s most recent survey, 65.8% of respondents said their new graduate hires could work from home some or all of the time.

Set competitive Gen Z pay in Canada with data from Mercer

If there is one thing that always stays the same, it’s that what worked for older generations will not work for younger ones. If your business still uses the same old hiring strategies, you will likely miss out on attracting and retaining the new talent your business needs to thrive.

Attracting new talent starts with competitive new hire pay. Using Mercer’s latest Canada New Graduate and Generation Z Compensation Survey data will ensure your salary offers are competitive.

To learn more about this survey and other products from Mercer, give us a call today at 866-605-1031. You can also email us at surveys@mercer.com.