Examining the salaries your company offers regularly is essential. By doing so, it’s far easier to remain competitive, leading to easier recruitment and improved retention. By conducting a wage analysis, you can determine whether pay rates need to shift this year. Here are three wage analysis tips for 2023 to get you started.
1. Know Who Your Competition Is
Most employers know that ensuring the wages they offer are at least equal to what’s provided by other local companies in their industry is essential for attracting and retaining talent. However, it’s also critical to look beyond your sector in 2023 if you want to achieve hiring and retention success.
Today, many industries with low barriers to entry are increasing their wages to attract talent. For example, both fast food and retail companies are boosting their starting pay, and many of those businesses are open to hiring candidates with no experience and only basic skill sets. As a result, employers should include these companies in their wage analysis if their pay rates are similar to what their business offers.
If you fail to keep pace with salaries available in jobs that don’t require many starting skills, candidates may not view your opportunities favorably. Essentially, they’ll wonder why they should accept a more challenging role when they can receive similar compensation in a position that isn’t as demanding. As a result, it’s critical to look beyond your industry and examine every role your target candidate could potentially land, allowing you to ensure your compensation makes sense based on your performance expectations and skill requirements.
2. Calculate the Value of Your Benefits
Benefits offered by employers are part of the broader compensation package, so they need to become a part of your analysis. Certain benefits may reduce costs for employees beyond what they find at competitors. Others may directly increase wages, such as performance and attendance bonuses.
By calculating the value of your company’s benefits package, you can determine how they impact an employee’s take-home pay. For example, covering a higher percentage of an employee’s healthcare premium results in a financial gain for the worker. Student loan repayment and tuition reimbursement have a similar impact, while higher-than-average employer matches on retirement contributions boost retirement savings.
When you know the value of your benefits, you can factor them into the equation. Plus, it gives you points to advertise in job listings to showcase how much an employee saves or earns, making your positions more attractive.
3. Factor in Compensation Trends
While it’s critical to understand where your company stands based on the current compensation levels in your area, a thorough wage analysis also factors in compensation trends. Knowing how wages are projected to change in the coming months allows you to plan for potential upward shifts proactively. As a result, it’s far easier to stay ahead of the curve, leading to improved recruitment and retention outcomes.
Ultimately, a thorough wage analysis is essential in 2023. If you’d like to learn more about how to remain competitive, The Advance Group wants to hear from you. Contact us today.