Many HR professionals, especially those with 200 or less employees, struggle to convince their management and/or ownership the value of investing and participating in compensation surveys. Why? The answer is typically is “it’s too expensive…or, not worth it”. However, below are a few questions that should be posed to management and/or ownership:
Would you guess at the sales revenue from your top 20 clients?
Do you want to pay $40,000 more than needed for your new VP of Research?
Are you aware of the compensation range variances between 1 region of the country vs another for the same position?
Here are 5 reasons ALL employers should participate in credible Compensation Surveys:
Aiding in paying employees competitively: According to research by Fredrick Herzberg (American psychologist who became one of the most influential names in business management and is most famous for introducing job enrichment and the Motivator-Hygiene theory) compensation can be more of a de-motivator than motivator. In other words, if staff know or feel they are underpaid, morale and productivity will suffer. Reputable compensation surveys can bring much needed objectivity to decisions regarding pay.
Market conditions will change: All industry sectors have ups and downs. During a time when a particular sector is thriving, employers should have current knowledge of going pay rates for critical roles.
Be a “good steward” in the HR Community: Participating in a 3rd party compensation survey encourages other “like” employers to do the same. This collaboration results in a much more accurate picture for everyone involved.
Build confidence and loyalty among staff: Many employers use compensation survey data to demonstrate that annual homework/research has been done and shares that information one-on-0ne with staff during annual reviews.
On average, total costs of workforce equates to nearly 70% of operating costs: Ask yourself and other members of management and ownership this question – “can you really afford to guess at your largest expense item – what and how to pay your employees?”
Proven industry specific compensation/salary surveys can be an excellent tool if incorporated into the annual business planning process. For over 8 years, AgCareers.com has provided its Compensation Benchmark Review (CBR) to the agriculture industry. The CBR has grown to include over 200 industry roles with 125+ participating employers. To learn more about AgCareers.com’s CBR, click here.