Canadian MSPs plan the lowest pay increases of any region, and that might not be a bad thing

In this episode of ChannelBuzz.ca, host Robert Dutt explores the latest findings from ConnectWise’s 2026 Service Leadership Compensation Report, focusing on compensation trends in the Canadian IT channel. The report reveals that Canadian MSPs are planning the lowest pay increases globally—only 7% of employees receiving raises above 6%, with 42% getting 3% or less. Peter Kajawa, Executive Vice President of Service Leadership at ConnectWise, explains this trend isn’t due to financial distress but rather a softer macroeconomic environment, reduced tech industry hiring, and a shift in employee sentiment as major tech layoffs make staying at stable MSPs more appealing. The episode unpacks a counterintuitive insight: top-performing MSPs (best-in-class) give significantly fewer large pay increases than bottom-quartile firms, not because they underpay, but because they structure their organizations more efficiently—narrowing customer focus, standardizing tech stacks, and hiring more entry-level talent. These firms also rely more on incentive-based pay and invest in lead generation over sales headcount. Kajawa emphasizes that while wage inflation has cooled since 2022, it remains double the rate of CPI, making AI and automation essential for long-term survival. The episode concludes with actionable takeaways: benchmark compensation by role and experience, revamp incentive structures, and restructure staffing to improve efficiency and profitability.