Job-hopping is paying off in Canada, and more than in the U.S.

Canadians interested in new jobs are seeing a bigger financial payoff when they move than those who stick in their current roles, despite headwinds in the labour market, according to research from Automatic Data Processing.

And people switching jobs may see an even bigger pay bump rate than those in the U.S., the ADP report found.

Those who made the move in this country saw their base pay grow 5.6 per cent year-over-year in August, up from 5 per cent in July, according to research from ADP, a human resources and payroll management company. That compares to just a 3 per cent boost for job stayers – a number that’s remained flat since December.

The ADP’s report draws on the anonymized payroll transaction data of approximately 1.6 million Canadian workers each month, through a matched sample over a rolling 12-month period.

Meanwhile, their gross pay – total compensation including extra overtime hours and add-ons such as bonuses and tips – surged 9.6 per cent while job stayer earnings rose a more modest 4.4 per cent. When job changers are better off than job stayers it usually signals a tight job market.

The premium for switchers in the U.S., on the other hand, sat at just 2.2 per cent compared to Canada’s 5.2 per cent.

“We’ve described the U.S. market as ‘low hire, low fire,’” said ADP chief economist Nela Richardson. In Canada, “there is a benefit still from job switching.”

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ADP’s Canada Pay Insights report, released Thursday, looked at payroll transaction data for individual workers at private employers in Canada, with the pay of each worker compared over 12-month intervals.

Its data comes against the backdrop of a less-than-ideal outlook for Canada’s job market across the board. Trade tensions with the U.S. have seen renewed vigour as U.S. President Donald Trump slapped Canada with a series of sweeping new levies last month and Ottawa fired back with “dollar-for-dollar” tariffs of its own.

Statistics Canada figures released Friday showed that the hot streak in the country’s labour market, which added 181,000 jobs from April through July, came to a screeching halt, with more than 40,000 jobs shed in August.

That said, the unemployment rate held steady at 6.4 per cent last month, and most of the losses were in the public sector. Whereas Statistics Canada’s employment survey captures changes in the overall composition of employment, ADP’s measure follows the same individuals’ pay cheques over time.

A Canadian worker who already has a strong position should not interpret the report as a sign to throw caution to the wind, according to Ms. Richardson. Someone considering a switch will be in a better spot if they have the new job already lined up before leaving the old one.

But momentum has started to pick up in sectors such as hospitality – a category that includes servers, chefs and hotel receptionists – along with finance and professional services, such as business consulting, where average base wage growth hovered between 4.6 and 4.8 per cent.

Those figures would mean a sales associate working in the finance sector and earning $90,032 would get a pay bump of around $5,000 in base wages when making a move or a total compensation of around $100,000 if looking at gross pay.

While the premium may not be where it hovered in 2023, for example, when a worker switching roles could see their gross pay go up 15.8 per cent on average, “you can still recoup a premium from jobs switching for the typical worker,” Ms. Richardson said.

Though the momentum is not evenly distributed. ADP found that the first quartile of workers, representing the bottom 25 per cent of earners, had wage growth of just 2.7 per cent in August, compared with 3 per cent for the other 75 per cent. “There is a gap there between the bottom versus everyone else,” Ms. Richardson said.

Cory Stahle, senior economist atthe employment website Indeed, said the biggest potential lies in a few small pockets of the labour market.

Indeed data, which tracks public sector jobs as well as private ones, showed Canadian wages in job postings for finance, for example, grew 5.5 per cent in July, as well as 4.1 per cent for physicians and 3.7 per cent in the education sector. Generally, job wage growth hovered at 2.6 per cent year-over-year.

For people considering a job switch, those pockets should indicate where employers are willing to pay more to attract workers, Mr. Stahle said.

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Finance job growth hovered at 42 per cent above pre-pandemic hiring levels. For software developers, after seeing major declines in tech demand following the heated job market of the COVID-19 lockdown years, postings have begun to stabilize as well, Mr. Stahle said, while advertised wages were up 4.4 per cent this summer.

“These jobs have been taking a beating for the last couple years,” he said. “It’s a little bit of hope for job seekers who have been watching the tech sector.”

AI job postings are also seeing stronger demand and not just where one would expect. AI roles have been embedded into legacy jobs such as real estate agent, with employers in that field looking for someone to take the lead with the emerging technology.

The job market picking up in certain pockets but remaining lukewarm across the board, could actually be an asset for some job seekers, Mr. Stahle said.

The fact that there’s less competition at a time when wages are showing signs of rising “could mean that for a job seeker right now that might be the perfect time for you to look.”