Ways to Set a Competitive Salary
You always hear about offering a “competitive salary” to your employees, but what does it mean? How do you offer one without sacrificing the business?
A competitive salary entails a lot. The goal is to ensure that you only attract the best talent in the industry. You also want to retain your talents and reduce the turnover rate. Let’s face it. Many people work hard because of the monetary rewards. They won’t waste their time working for a company when they’re not paid well. Here are some ways to set a competitive pay.
Research the market
Study the median salary for a position. You can get the information from a local agency. You can also conduct research on your competitors. Find out how much they’re paying their employees for doing a certain job. You can be competitive by going slightly above the median pay.
Consider other factors
While it’s important that you offer a competitive rate, you must also think about where your company’s finances stand. Perhaps, you should stick with the average if you don’t think you can afford a full-time employee with a higher than market rate. As long as you’re within the median rate, you’re good. You will attract potential applicants. It’s only a problem when you go way lower than expected. There are still applicants, but they’re not as good as you would have hoped.
Consider experience in setting the salary
When you advertise the post online, you can offer a baseline salary. However, the amount can go up depending on the experience and skills of the candidate. You can increase the salary if you think the person can contribute more to the team. There’s a difference between someone who has only been in the industry for a year and another one who has been around for decades. You can’t expect an industry veteran to accept a meager salary. Even educational background has to be considered. It shows how that person values education and the thirst for knowledge.
Offer benefits too
While you can’t always offer the highest salary, you can also throw a benefit package. Potential applicants might consider the job if they see that the benefits are competitive enough. For instance, you should offer comprehensive health insurance. You may also offer scholarships for employees who want to study. Offering paid sick days and maternity leave are also enticing. Not all companies offer these benefits and you will have an edge in doing so.
Staying competitive in the market can be difficult. You have to consider several factors before you offer a salary rate. You want to pick the best person for the job and not let go when you’ve found the right one. If you can’t offer a reasonable rate, you will be left with candidates who are still testing the waters. You don’t want to run that risk.
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1st and featured image from https://theshillongtimes.com/wp-content/uploads/2022/06/salary-payroll.jpg
2nd image from https://www.uschamber.com/co/run/human-resources/salary-competitive-analysis
