2019 is fast approaching which no doubt means you are considering pay reviews and with that raises the question – have you thought about salary benchmarking?
The way you pay, including how much and why, matters to your current and potential employees. Undertaking salary benchmarking will give you impartial and accurate pay information to help define a fair and competitive salary for the employees of your company. The results will provide you with an accurate salary range for a specific position, taking into consideration the region, industry, company size and other factors that make up the compensation package.
What are the advantages to carrying out salary benchmarking?
We believe that establishing the market rates for the positions within your business is important for a number of reasons.
- It will help guide pay decision-making and better equip you to define the costs associated with salaries and other compensations such as profit sharing or bonuses
- It provides invaluable information to help ensure your salaries are competitive, and understanding the competitive market is a crucial step towards creating alluring payment and compensation packages that both attract and retain top talent.
- Labour costs are the largest cost to any business so a solid understanding of the external value of each position will allow you to develop an approach for setting the overall compensation package and salary levels.
- There are a rising number of online salary insight tools available where your employees and potential candidates can gather pay information easily making it likely that they will know their worth. With access to this information at the click of the button, it really does highlight that we are living in a candidate driven world and it’s vital that you gauge the attractiveness of your job positions and stay competitive.
- Enlisting a third party to carry out your salary benchmarking for you can save you time and you know it will be impartial, reliable and accurate.
- Demonstrate to your existing and future employees that you care. It is likely that carrying out salary benchmarking and communicating your pay practices clearly to your staff will contribute to better employee engagement and satisfaction.
Overall, salary benchmarking gives an impartial and accurate idea of pay information to help businesses make informed and effective remuneration decisions, while at the same time accounting for variations that need to be considered.