Treading Carefully in 2025: How Tech Employers Are Approaching Compensation
April 09, 2025
As political and economic headwinds continue into 2025, many People & Culture leaders are navigating tough decisions to keep their organizations on stable footing. In March, TAP Network surveyed its members to understand how tech employers across Canada are responding—particularly when it comes to compensation strategies and cost-saving measures.
Companies Are Tightening Their Belts
Survey responses show that many tech companies are implementing cost-saving actions, with the most common being limiting hiring to only critical roles. Other frequent steps include reducing spending on:
- Business travel
- IT tools and subscriptions
While 26% of companies reported having implemented layoffs in the past six months, another 17% are considering layoffs in the next six months. On the other hand, 15% say they do not anticipate any talent-related cost-saving measures in the months ahead. Overall, the data points to a cautious approach, with most companies pulling back in some way.
Salary Increases Slowing in 2025
What does this mean for compensation in the Canadian tech sector? According to our March 2025 survey, salary increases are slowing:
- 42% of companies have decreased their 2025 salary increase budgets compared to 2024
- 10% are not planning any salary increases this year
For those moving forward with increases:
- 39% are budgeting increases of 3.5% or less
- 30.5% are budgeting increases of 3.5% to 5%
- 12% are budgeting for increases above 5%
While we’ll continue to see competitive pay for in-demand roles, year-over-year compensation movement is expected to be more modest than in previous years.
The Impact of Pay Transparency Legislation
Looking ahead, Ontario’s upcoming pay transparency legislation will likely prompt more companies to seek detailed, reliable compensation data. Understanding where your organization stands in the market will be more important than ever.
Participate in the 2025 TAP Network Salary & Total Rewards Survey
Now is the time to contribute to and benefit from TAP Network’s 2025 Salary and Total Rewards Survey, produced in partnership with Mercer. The survey delivers deep insights into:
- Local and national salary benchmarks
- Total compensation and rewards practices
- Detailed HR policy data
Participants represent a wide range of Canadian tech employers—from startups and scale-ups to multinationals—across subsectors like software, AI, clean tech, hardware, VFX, animation, gaming, and more.
Join TAP Network today to participate.
Make sure your organization is equipped with the data it needs to navigate 2025 with confidence.