There are three major steps in the salary benchmarking process: building a salary base, analyzing employee compensation rates, and establishing pay ranges. Before you can start the process of analysis, you need to establish two important factors.
What is the best salary benchmarking tool?
Best salary information websites
- Salary.com. The most popular salary-specific job site, Salary.com lists every position in a field with free salary info.
- Glassdoor. Glassdoor is known for its extensive company reviews and employee feedback.
- PayScale.
- Indeed.
- SalaryList.
- Salary Expert.
- Bureau of Labor Statistics.
- Job title.
What is benchmarking in terms of salary?
Salary benchmarking is the process of evaluating a company’s internal job salaries based upon their external value. Salary benchmarking involves analyzing the main components of each position and comparing these positions to similar jobs in other companies.
What sources do most employers use to benchmark compensation?
What sources do most employers use to benchmark compensation? Most employers use more than one salary data source to make compensation decisions. Common choices of salary data sources include Mercer, Willis Towers Watson, Kenexa, CompAnalyst, ERI, and Aon Hewitt.
How do you perform benchmarking compensation? – Related Questions
What is the first step in compensation benchmarking?
Because many companies these days, especially small businesses, have roles filled with people who wear many hats, the first step to compensation benchmarking is identifying all of the key attributes of a position.
Why do we do salary benchmarking?
From an internal perspective, salary benchmarking provides an impartial and accurate idea of pay information to help businesses make effective, non-discriminatory decisions which will be potentially of great benefit to long term company growth and sustainability.
What is benchmarking in compensation and benefits?
Compensation benchmarking is the process of researching appropriate compensation and benefits for a particular position, a candidate of a specific experience level, or a combination of factors. Compensation benchmarking serves many purposes, and it requires sufficient attention if you want to do it right.
Why is benchmarking important in the compensation and benefits functions?
Salary benchmarking helps companies attract and keep quality talent by ensuring they provide competitive compensation. Compensation benchmarking helps control labor costs, which in turn helps manage operations costs. Salary benchmarking can help to highlight and remedy pay inequities in your company.
How do I benchmark my job?
The benchmarking process involves five stages, which will be dealt with in individual chapters: evaluate • classify • compare • adjust • monitor. One of the primary goals when setting the level of remuneration for a job is to match it to the ‘market rate’.
How do compensation surveys work?
A compensation survey is a popular technique that an organization can utilize to ensure employees are given fair wages and benefit packages. The results of the survey should provide key insights into job roles and salaries, that will assist employers in determining and optimizing their own compensation strategies.
Where can I find salary benchmarking data?
One of the largest and most comprehensive sources of free salary information is the Bureau of Labor Statistics (BLS). The BLS has salary survey data for many different positions in various industries as well as for specific geographic locations.
What should be included in a salary survey?
Types of data gathered in a salary survey
- Base salaries.
- Increase percentages or amounts.
- Merit Increases.
- Salary Ranges.
- Starting Salary.
- Incentives/Bonuses.
- Allowances and Benefits.
- Working Hours.
What are the steps in conducting a wage and salary survey?
Reviewing how to do salary market research and conduct research for compensation projects will help you get the best results possible.
- Identify Your Target Professional.
- Create a Random Sample.
- Choose Your Survey Method.
- Construct Your Questions.
How do you create a salary range?
One way to create a salary range for a specific role is to ask your candidates what their personal salary expectations are for the role. Doing this will give you a range of what your candidates will be expecting from an offer, and it will give you the ability to make an accurate salary range for the position.
What is salary structure design?
A salary structure is a hierarchy of jobs and salary ranges for an organization. The design of a salary structure should be aligned with your organizations Total Rewards Strategy, and support competitive pay levels and internal equity or any unique needs of an organization.
What’s a key objective of wage and salary surveys?
Salary surveys collect information about employee salaries and benefits across different industries, regions and jobs. These surveys serve as benchmarking tools to enable companies to make informed business decisions about compensation.
Why do companies use salary surveys?
In addition to determining competitive pay, surveys can help an employer design a total compensation package, Manoli said. Offering a recruit a sign-on bonus might give an employer an edge in getting an employee in the door quickly. Plus, it has the benefit of being a one-time expense.
What is a salary market analysis?
What is a compensation analysis? A compensation analysis is a review of employee pay in relation to an organization’s pay philosophy. It often takes into account both internal equity and external competitiveness to ensure fair pay that can attract, engage, and retain talent.
How long does a salary survey take?
Conducting a salary survey is a time-consuming task. A traditional survey of 15 companies encompassing 20 positions can take between 6 and 12 weeks from the initial planning to the time the survey is distributed to participants.
What is salary survey in HR?
What Is a Salary Survey? A Salary Survey is a tool used by companies to determine fair and competitive compensation for a position. The survey contains compensation data based on position, industry, location, size of company, and several other variables and shows the average salaries for different roles.