Pay and benefits play a significant role in your organization’s ability to attract and retain top talent. Making informed, intelligent decisions based on salary data is one of the best ways to guarantee your competitiveness in the talent marketplace. But understanding the data that is available and evaluating which sources are right for your organization can be daunting.
We’ve compiled a few practical considerations for choosing the right data for your organization.
Informal salary data
This information is mostly free and typically gathered from Google searches, conversations with peers, social media posts, recruitment agencies or other anecdotal sources. In fact, these sources have made it easy for employees to explore typical pay for their roles – then turn around with their research in-hand and question the competitiveness of their salary.
But experienced compensation and HR professionals understand the proper place for crowdsourced or web-scraped data: Providing an indication or reference point when no other data is available. While crowdsourced data may fill the gap when other information is unavailable, it lacks the nuance and sophistication of tested, validated and credible employer-verified data.
Formal salary data
This data is a result of organizations submitting their data to a salary survey that keeps all information anonymous. Oftentimes, the data is submitted against a tested methodology that ensures results are understandable when compared. While formal salary survey participation carries a time commitment, in the end it delivers on quality and value – especially compared to informal sources.
Identify the right salary survey provider
There are many third-party salary survey providers in the marketplace, making it mission-critical to understand the strengths of each so you are confident in your final choice. As you assess salary survey data providers, there are several aspects to explore.
- Data collection process.
To promote high-quality and consistent data, a salary survey provider should make the data submission process seamless and automated. For example, pre-populated workbooks of data that has been previously submitted makes the current year’s update simpler, and the ability to import salary data makes it easier to collaborate and make edits directly and securely. Further, the submission tool should automatically check the completeness of your submission and raise questions in near real-time to lessen the burden of tedious reviews.
- A well-defined methodology.
Deciding whether a salary survey provider’s data is the right fit for your organization depends on how meaningful that data is to your organization. You need to review the survey participants and identify whether there are enough organizations against which you compete for talent. Can you create a peer group of organizations? How many positions are reported for your salary benchmarks? And what functionality does the provider offer to reduce your effort in matching jobs to survey jobs?
- The always-important human touch.
Choosing the right salary survey partner goes beyond data and software. You should have support throughout the entire process, whether that means helping you submit your salary data or understanding how your data compares to the market and offering advice on strategic actions to consider.
Find the right solution for your rewards strategy
The world has become a smaller place in the past few years, particularly as geographic boundaries have essentially disappeared with the dramatic increase in remote work. In the world of salary survey data, this makes it critical to ensure you have a solid benchmarking representation, and that the data you’re accessing is meaningful to your total rewards strategy.
Naturally, the data you’re benchmarking against should reflect the elements you include in your pay and rewards programs, like base pay, total cash, long-term incentives, total direct compensation – and any other specialized elements you include to make your employee value proposition that much richer.
Going back to that smaller world we’re functioning in, does the salary data reflect local practices like car allowances, guaranteed pay elements and other programs that local employees may automatically expect? Or is the data so broad, your only option is to take a peanut butter-spread approach? Remember: Your entire total rewards package supports your overall employee experience as well as how your employees value it.
Address your unique talent needs
There are a variety of considerations when choosing the right source of salary survey data for your organization. Many of those considerations are based on your unique talent needs – each of which will need to be addressed in priority order based on your total rewards and business strategies.
A rise in hybrid and remote work arrangements brings another dimension to Geography. As employees increasingly can work from anywhere within a country or globally and successfully fulfill their role, organizations need to review Geography criteria in more detail.
| 1 |
Sector |
Sector-specific competition for talent |
|
Cross-sector competition for talent |
| 2 |
Peers |
Only direct competitors |
|
Broader talent markets including aspirational organizations |
| 3 |
Geography* |
Local (e.g. national sample) |
|
International |
| 4 |
Size |
Organizations comparable in size |
|
Diversity in organization size (smaller/larger) |
| 5 |
Structure |
Corporate/HQ organizations |
|
Subsidiary organizations |
| 6 |
Maturity |
Mature organizations |
|
Start-ups/Scale-ups |
A thoughtful approach to sourcing your salary survey data positions you to strategically identify your talent market(s) and, at the same time, ensure your pay plans are built on a solid foundation that allows you to attract and retain the talent you need today – and in the future. That’s the power of good salary data.
