When you’re hiring, you’re looking for skilled talent who can help take your company to the next level. And you have to offer a competitive remuneration package to attract that top talent. Lower your offer, and the people you want are certain to choose another firm — especially when the economy remains strong and unemployment is low.
But how can you know how much is enough? You’ll need to figure that out long before you bring up salary and benefits in a candidate interview. Here are tips on determining pay levels:
Consult salary surveys
Rule No.1 in salary-setting: Make sure you’re paying the same or, preferably more, than your competitors. To find out what this should amount to, you need to research what other organisations pay employees in similar jobs. The Robert Half Salary Guide is an excellent resource for this type of information. Robert Half’s guide is based on real-world salary data, drawn from the temporary and permanent placements our recruitment experts make.
Don’t forget the other elements of remuneration
Top talent expects not just a base salary that’s the same or more than offers they may be getting from other companies but also a competitive choice of bonus and benefits.
Keep in mind that you shouldn’t offer benefits to make up for a lower salary; they should sweeten what is already an attractive starting salary offer.
Remember that you’re paying people, not positions
Base your pay on the actual technical and soft skills, knowledge and experience workers bring to the company — not just what’s requested in the job description for the positions they’ll fill. That’s why the Robert Half Salary Guide lists average salaries in four percentiles, starting with the least experience on up to significant, highly relevant experience, among other factors.
When it comes time for the salary negotiation, you can base your offer on what each candidate is likely to bring to the job.
Whatever you do, don’t underpay
Obviously, when you set salaries that are too low, you miss out on the top candidates. But there are other consequences, as well. Employees who do come to work for you will be more likely to feel like the business doesn’t value them, which, in turn, could make them less engaged at work and less productive overall. Underpaying employees often leads to higher turnover.
Determining appropriate remuneration levels when hiring takes some work, but it’s worth it: You must be prepared to offer a competitive salary if you want to land top candidates — and if you want to keep them happy and productive in the long run.
Continue to adjust salaries
Make sure you’re constantly evaluating and updating your salaries, taking into consideration your firm’s salary, reward and recognition philosophy, the range of other benefits you offer, and the salary levels for individuals within a particular market.