It’s important to benchmark your organisation’s salaries for multiple reasons – like being able to attract the best talent, optimising your employees’ performance and productivity, and knowing how to retain your staff.
We’ve discussed what salary benchmarking is, but why is it a worthwhile exercise? Talking about pay isn’t always a comfortable topic, and it might seem unwise to ‘shake things up’ by examining your pay practices. But in this article, we’ll explain several reasons it’s worth doing.
Salary transparency matters to your talent
The vague promise of ‘competitive pay’ on job ads just won’t cut it anymore. The people you want to hire expect to know salary information upfront – 70% of prospective hires want to see it, according to Glassdoor. In some places – like New York – listing a salary range has even become a legal requirement as a reflection of that growing trend.
Salary benchmarking means you can be comfortable with being transparent about the range you’re willing to offer – as you know you aren’t going wildly below (or above) market rate. It also means you can justify your pay offers in interview situations.
Offering a competitive rate of pay? It pays off
Let’s be realistic: salaries matter. No-one’s going to give you their best efforts if they feel they’re being underpaid – and research supports that. SHRM research found that 60% of employees consider their pay to be a top factor in job satisfaction, and several studies point to a link between higher wages and higher productivity too.
It stands to reason. As important as other factors like ‘a sense of purpose’ are, people work to get paid. If they feel they’re paid fairly, they’re likely to make sure they’re earning it.
Unfair pay practices UK leaders should avoid
Salary benchmarking can also be done as part of a pay audit, if you want to spot and amend unfair pay practices in your organisation. The gender pay gap and the even greater pay gap experienced by minority ethnic groups are still things that leaders need to be aware of.
Benchmarking different groups in your organisation can identify any pay discrepancies, and let you feel confident that you’re ‘walking the walk’ when it comes to fair pay.
Benchmark salary throughout the employee lifecycle:
Attract talent
When you’re hiring new staff, a salary benchmarking exercise means you can feel confident about the pay range you advertise. Crucially, so you do include a pay range – because it’s something prospective hires increasingly expect to see.
Engage talent
Employee satisfaction and engagement is linked to offering competitive pay. By staying on top of industry fluctuations, and keeping an eye on internal salary levels, you can create a workforce that’s willing to offer their best work.
Retain talent
It’s no secret that the easier way to get a sizable pay rise is to move jobs. If you’re serious about retaining your talent – and understand the high cost of attrition – then staying on top of salary benchmarks means you know what it’ll take to keep them.
Qlearsite’s salary benchmarking & cost analysis
- Global salary data, from over 1 million organisations
- Benchmarks automatically mapped to your job titles
- Calculation of the cost of attrition and absence
Salary benchmarking is now a part of Qlearsite Pro – along with attrition and absence benchmarking, automatic people analytics, and much more. It’s the perfect way to make informed decisions – whether you’re reviewing pay structures, or trying to reduce absenteeism. Request access now:
