The labour costs in the insurance, reinsurance, and pension funding sectors in Canada have experienced a steady upward trajectory over the past decade, increasing from CAD 8.66 billion in 2013 to CAD 12.9 billion in 2023. The average annual growth rate over the last five years has been around 2.89%, showcasing a consistent rise despite a few fluctuations. Specifically, there was a noticeable year-on-year increase of 8.88% in 2017, followed by a period of more moderate growth, averaging around 2-3% annually in recent years.
Forecasts indicate that labour costs will continue to climb, reaching CAD 14.27 billion by 2028. However, the pace of growth is expected to slow, with a forecasted 5-year CAGR of 1.59% and an overall growth rate of 8.21% over the same period. This deceleration suggests that while costs will grow, the rate of increase will become more moderate.
Future trends to watch for include the impact of technological advancements and automation on labour costs, changes in regulatory frameworks, and economic factors that could influence wage inflation or industry demand dynamics. These elements will be crucial in determining whether the current projections hold or require adjustments.
