What is salary benchmarking?
Salary benchmarking involves using research from benchmarking tools and other data sources to identify, track and compare similar salary rates to determine the pay package for employees.
Salary benchmarking allows businesses to compare their salary and perks to those offered by competitors. It can be used effectively as both a retention and recruitment tool, enabling organisations to assess their competitiveness in the marketplace in order to retain staff and attract new talent.
How to do Salary Benchmarking
To conduct salary benchmarking, we recommend using a reputable salary survey or benchmarking tool to run benchmarking reports. A good salary survey will use criteria such as company turnover, sector and location to provide more accurate results. Importantly, salary benchmarking reports are unbiased, meaning that the outcomes are fully accurate and credible.
Salary Benchmarking Tools
There are many salary benchmarking tools available to businesses, but you should consider if you have the internal resources to sift through this data to draw out useful insights. If you require a more detailed report, you may need to enlist the help of an expert third party, such as hr inspire, to complete the task.
Benefits of Salary Benchmarking
There are many benefits of salary benchmarking:
- Employers gain a better insight into the job market so roles can be remunerated at the right level, attracting the right candidates.
- Ensure your staff are paid competitively, and in line with the current market. By making sure your business is competing, you retain your top talent by helping to make sure they don’t defect for a better pay packet. Plus, offering competitive packages boosts employee engagement and retention, driving a positive culture and improved productivity.
- When recruiting, you can adjust your offer in response to market demand and current trends.
- Benchmarking reveal areas where your competitors may be outperforming you, and where you may be outperforming them
- Through salary calculation, your business can identify budget that needs to be allocated when hiring new employees.
Expert advice from hr inspire
hr inspire’s HR team have significant experience and knowledge of salary benchmarking, alongside direct access to one of the most comprehensive independent pay and benefits databases in the country.
Undertaking insightful salary benchmarking is about more than just accessing the data available – our expert team use their knowledge to blend the data with insight on understanding:
- Your specific organisational structure
- The role’s seniority and responsibilities
- Live industry research on roles in the market
- Affordability when considering other onboarding costs, from national insurance & pension to other benefits
hr inspire uses salary benchmarking to support reward structure development or as a stand-alone service for individual positions that are either new to the business or simply need updating, giving you the opportunity to undertake either regular small-scale activity or larger departmental or company-wide exercises.
Our team provide fast and accurate salary benchmark reports, from which management can base sound and independent reward management decisions.
For more information on salary benchmarking, please contact our expert team.