Most oil and gas employers will not raise salaries next year amid the plunge in crude prices.
Nearly a quarter of the energy industry expects to freeze salaries and 40 per cent will not increase compensation, according to a survey by consultancy Hays Canada.
The survey found that nearly half of the industry either froze salaries or did not increase pay this year. That compares with about 20 per cent of mining and resources industry, another part of Canada's economy that has been hurt by weak commodity prices.
Oil and gas employers are also expected to cut more jobs with a third of those surveyed forecasting a decrease in head count next year, the report said.
The oil, mining and resources industry has already shed more than 26,000 jobs across Canada, with energy-rich Alberta losing the bulk of those jobs.
Although the oil woes have spread to other parts of Alberta's economy, employers across the country remain optimistic about the labour market.
When employers across various sectors were asked whether the "turbulent markets" would affect salaries and hiring, the majority reported no change in plans.
However, what has changed is confidence.
Although most employers think business activity will pick up next year, they also believed activity would jump this year. In reality, less than half of the employers surveyed experienced an increase in business activity.
In British Columbia and Ontario, which are both on track to grow more than 2 per cent this year, more employers expect the economy to remain static or decline next year. Previously, more employers believed the economy would strengthen.
"It is definitely eroding confidence in general," said Rowan O'Grady, president of Hays Canada.
The Hays survey polled more than 3,300 employers and employees in October. The report looked at 13 sectors, including natural resources, construction, manufacturing and sales.