Whilst money may not be everything when an individual is looking for a new job, research suggests it’s certainly important.
Although candidates prioritise elements of their overall remuneration package before salary when they have a job, it’s a different matter when an individual is on a hunt for a new challenge. A 2018 LinkedIn survey revealed that salary information is still one of the top three things 61% of candidates expect to see.
Further to that, a whopping 67% of the people asked in a recent Glassdoor study said salary is the most important factor job seekers look for in job ads.
In contrast, a survey of over 14,600 professionals and employers found only 46% of recruiters always include salary information on job adverts. This decision is often out of fear it may put them at a competitive disadvantage, or cause resentment amongst existing staff.
Many companies believe that by making pay public, it will make it easier for competition to poach their existing employees. For some this can cause internal conflict, particularly between those who started on a lower wage. Salary may also be withheld to use as a negotiation tactic with applying candidates.
Shelly Holt, the chief people officer at PayScale, suggests that much of the hesitancy around salary transparency comes from companies that lack both formal pay structures for their roles and confidence in their salary bands, often due to market fluctuations.
Whilst there is hesitancy around publishing salary information, putting salary ranges in job advertisements may in fact give employers a competitive advantage when trying to attract candidates. This is because most job seekers initially look at a position’s salary and benefits when scanning a job posting, followed by the job’s required qualifications and duties, according to new research from LinkedIn.
Organisations that are open about salary can win over the best candidates and attract diverse applicants. An increasing body of research shows that companies who are forthcoming about their wages can attract better, more diverse talent, making salary transparency an actionable way of creating a more equitable workplace.
Companies promoting pay transparency may change the way the job market works; they are forcing organisations to share more about how they are paying and reducing inequality.
Salary is often a leading factor in determining if a job role is right for an employee. Most people do not want to waste their time applying for a role where pay does not meet their expectations. Therefore, it is in the interests of both the employer and the employee for this to be clearly stated on the job advertisement.
These reasons for pay transparency are becoming more widely recognised and have led to global movement to make salary transparency not only a new norm, but rather the law. For example, in Latvia, a new law that came into effect in 2019 makes it mandatory to post expected salaries on all job advertisements.
In the US, Colorado became the first state to enact a law like Latvia’s earlier this year. It requires employers to disclose hourly wages or pay ranges in all job vacancy listings, with fines for not complying between $500 and $10,000 per violation. Moves like these have forced businesses to look at salary transparency in a fresh light and have caused a shift in societal pressures globally to push this.