Salary Surveys and Compensation Planning

Effective salary survey analysis and survey management can help a company reach its compensation goals by contributing to a flexible, internally equitable, and externally competitive compensation strategy.
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Why Use a Salary Survey Things to Consider Salary Survey Data Sources Salary Survey Data Utilization

Why Use Salary Survey

Salary surveys provide a wealth of salary data that assist organizations in making informed compensation decisions.

Purchasing industry salary surveys from reputable sources ensures that you are pricing competitively, while also maintaining confidentiality according to the Safe Harbor Guidelines set by the US Department of Justice and the Federal Trade Commission (FTC), as follows:

  • All data are reported in summary form only.
  • No data are reported for any job at any level where there are fewer than five companies matching (or three companies outside the U.S.).
  • No organization’s data will represent more than 25% weighting for any job (or 35% weighting outside the U.S.).
  • When choosing a salary survey vendor, be sure that the company adheres to Safe Harbor Guidelines to ensure the confidentiality of your information and help support strong legal grounds for your compensation decisions.

An industry salary survey provider helps compensation professionals make informed compensation decisions by identifying market pay practices to create a total compensation plan that will help bring in and retain top employees. Salary Surveys also assist in keeping track of jobs that are in and out of demand. Keeping up with the latest job trends allow you to accurately price jobs and keep up with market competitiveness.

Losing an employee can often cost more than the work and effort required to retain an employee. According to a study conducted by SHRM, the costs of employee turnover can be as much at 60% of the former employee’s annual salary, and the total costs can be as much as 200%. Regularly buying salary surveys or subscribing to datasets allows employers to create total compensation packages that help retain top employees.

Without reliable, up-to-date, and accurate salary survey data, you are relying on whatever you can find online or by hearsay.

SalaryExpert utilizes ERI’s salary survey data to ensure you have the most up-to-date compensation data. We have two separate ways of accessing salary surveys. You can buy an individual salary survey from ERI, or which you can receive a discount through participation. ERI’s salary surveys can be purchased here. Subscribing to the Assessor Platform allows you to gain access to our full range of compensation tools which allows for pricing of obscure job titles and shift differentials. Check out a sample of our salary survey data with our free demo.

Legal Compliance

Purchasing industry salary surveys from reputable sources ensures that you are pricing competitively, while also maintaining confidentiality according to the Safe Harbor Guidelines set by the US Department of Justice and the Federal Trade Commission (FTC), as follows:

  • All data are reported in summary form only.
  • No data are reported for any job at any level where there are fewer than five companies matching (or three companies outside the U.S.).
  • No organization’s data will represent more than 25% weighting for any job (or 35% weighting outside the U.S.).
  • When choosing a salary survey vendor, be sure that the company adheres to Safe Harbor Guidelines to ensure the confidentiality of your information and help support strong legal grounds for your compensation decisions.

Competitive Compensation

An industry salary survey provider helps compensation professionals make informed compensation decisions by identifying market pay practices to create a total compensation plan that will help bring in and retain top employees. Salary Surveys also assist in keeping track of jobs that are in and out of demand. Keeping up with the latest job trends allow you to accurately price jobs and keep up with market competitiveness.

Increased Employee Retention

Losing an employee can often cost more than the work and effort required to retain an employee. According to a study conducted by SHRM, the costs of employee turnover can be as much at 60% of the former employee’s annual salary, and the total costs can be as much as 200%. Regularly buying salary surveys or subscribing to datasets allows employers to create total compensation packages that help retain top employees.

Dependable Data

Without reliable, up-to-date, and accurate salary survey data, you are relying on whatever you can find online or by hearsay.

SalaryExpert utilizes ERI’s salary survey data to ensure you have the most up-to-date compensation data. We have two separate ways of accessing salary surveys. You can buy an individual salary survey from ERI, or which you can receive a discount through participation. ERI’s salary surveys can be purchased here. Subscribing to the Assessor Platform allows you to gain access to our full range of compensation tools which allows for pricing of obscure job titles and shift differentials. Check out a sample of our salary survey data with our free demo.

Things to Consider with Salary Surveys

A reliable salary survey report will include several important factors, including the following:
  • Relevant compensation data collected from comparable organizations
  • Data customized by industry, employee type, job match, and location
  • Adherence to FTC Safe Harbor Guidelines for salary surveys
  • Executive summary
  • Aggregate data
  • Adequate sample size
  • Job content information

Survey Sources

Organizations that need market data have various options. The following list is
ranked from least expensive to most expensive:
6

U.S. government surveys (if one is applicable to your organization)

Government survey reports are free and statistically reliable. In fact, government efforts have contributed greatly to wage survey techniques. But most employers, even while using government occupational employment and wage statistics, do not find them sufficiently timely or specific enough to meet their needs.
5

Internet data (taken from free salary sites)

A convenient way to retrieve labor market data is through the Internet, which has proven to be a natural medium for conducting and distributing survey data. In general, free salary websites (also known as crowdsourced data) receive their revenue from the sale of advertising (not from the sale of surveys), leading some of them to inflate their data just to increase traffic.
4

Published salary surveys

Salary survey companies and consulting organizations conduct annual industry-specific, functional, and general surveys on a global, national, regional, state, or local basis. If you are looking specific compensation survey data by industry, occupation, or location, purchasing a published survey may be your best choice.
3

Survey software databases

Salary survey software databases are typically very robust and include high quality data. A reliable online survey database will provide the ability to filter market data to customize survey results and ensure the best possible job match, as well as consistency with a company’s compensation strategy.
2

Computer data banks

Large consulting firms typically will provide access to their extensive computer data banks on a subscription basis. When subscribing to a computer data bank, full access to the entire network of these compensation surveys can be included, providing access to an extensive global database.
1

Conduct (or sponsor) a new survey for your own organization

It is expensive and can be time consuming to conduct your own compensation survey, but it may be worth it if you need to:
  • Survey specific jobs or data requirements
  • Survey a specific industry or geographic area with limited survey data
Note: FTC Safe Harbor Guidelines for salary surveys should be considered.

Salary Survey Data Utilization

Most salary surveys are used to develop the annual base salary structure or compensation plan. Frequently, they are used to price individual jobs for new hires, existing employees, or even conduct a departmental market review.
Surveys can also be utilized to calculate salary increase budgets and even salary structure adjustments. Many times, surveys are utilized to assess and resolve compensation issues. Our salary survey data allow you to group similarly paid jobs together and break them down by specific industries to manage them within the same salary grade.
1
Develop a salary structure based on the market data for benchmark jobs. The salary structure may be calculated using a manual approach, an Excel rate formula, or regression analysis.
  • Average base salary rate per grade
  • Percent difference (progression) between grades
  • Calculate salary range midpoints while ensuring a smooth percent progression between grades and market competitiveness
  • Calculate range minimums and maximums
2
Another approach to consider is pure market pricing. Pure market pricing has been gaining popularity, and each job’s pay range is based on the actual market value of the job. There may also be multiple ranges per grade.
3
Once completed, slot the remaining non-benchmark jobs into the salary structure.
4
Develop a compa-ratio report comparing the employees’ pay to the midpoints of the recommended salary structure and related costs.

Global Pay Data

If your company operates globally, you can find which locations around the world have the highest and lowest compensation rates for a particular job title.

ERI’s Assessor Platform has a massive database of compensation for job titles around the globe. To see which locations we cover, refer to this list.

Shift Differential Data

Another consideration when utilizing salary survey data is how types of shifts, such as the late shift or early morning shift, have an impact on employee compensation.

Try a demo of SalaryExpert’s Assessor Platform to see how we make it easy for you to understand how shift differentials can be analyzed in order to create the best compensation plan for your employees.

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