Wage increases, overall, have been very modest over the last few years, and even over the last year, as we were hearing more and more from the companies that we speak to about labour shortages. We still see wage growth in the 2.3% range, which is actually quite modest for this point in a cycle, and that might be representative of many people. It's an average, so some have seen none, but others have seen a lot more.
You have to ask yourself what's happening. Why is that? Almost every country that has an advanced economy is asking itself the same question. There's no silver bullet. Clearly, the puzzle isn't as big as it might seem, because in fact wage growth before was quite a lot stronger. If you actually look at a graph of wage growth in Canada, it has picked up quite a lot over the last couple of years, but it still remains slow.
There are a couple of things going on here. More recently, wage growth may not have been that strong, because productivity growth wasn't that strong. If you're a company wondering if you can afford to pay your workers any more than you do now, even though you're short of workers, it's difficult to do that if you don't have the productivity to go with it.
Another reason is that maybe on the workers' side there are a lot of workers in the gig economy, the informal economy, and in that economy it's harder to bargain for your wage. There may be a little bit less power for people to actually get stronger wages.
When we talk to businesses.... In our forecast—you asked about that—we expect wage growth to strengthen and overall income growth—which includes not only your wage but how many hours you're working—to strengthen as well, to the 3% to 4% range. That corresponds with what companies are telling us. They say they're expecting to have to pay more to get the workers they need, and that's not just in the highest-paying jobs. That's across the board.