Compensation surveys: 4 tips to make them worth every penny
A compensation survey, also known as a salary survey, is a tool used to determine the market rate for a specific job. These surveys look at job titles, skills, education, experience, industry, and location to help employers determine fair compensation for their employees. Purchasing a salary survey can give you valuable insight into current trends, what others are paying for similar positions, and how to remain competitive in the job market.
Read on to find out what top four things you should be asking when shopping for the right compensation surveys for your organization.
Want to learn more about salary surveys? Check out our Salary Surveys 101 to get all the details you need to get started.
1. Who are the publishers and participants?
As with any other form of research, you want to determine if your compensation survey is collecting data from a reputable source, so researching who published the survey is crucial. Look for those that come from professional survey companies or a well-known trade association to ensure you’re getting reliable information. Not only should you pay attention to the publisher’s reputation, but the participants themselves can give insight into how well this survey may match your needs.
It’s best practice to find compensation surveys where human resource professionals submit the data, as individual employees may exaggerate their job duties or salary. While there are benefits and drawbacks to having employers versus employees report data for surveys, the reliable approach is to get the data directly from the organization itself.
2. How did they obtain this data?
Another aspect of a compensation survey to review before purchasing is its methodology. The main goal of purchasing a salary survey is to find a reliable data source. Ensuring that the research is conducted without bias is essential, so try to avoid surveys involving less than 15 companies. Otherwise, the survey will not provide an accurate view of the job market and may result in variations. You should also look for surveys conducted within the last year to ensure the most current information is provided.
3. Is the data reliable?
One of the most important aspects of choosing a compensation survey is determining if the data provided is reliable. Using the information above, we know who collected the data and how they did it. And this is a great way to determine the survey’s accuracy.
It’s also important to use a survey that includes various data points – such as percentiles and not just the average. While average compensation is valuable, surveys that provide the 25th, 50th (also known as the median), and 75th percentile give you a broader range of information and help you align your company’s compensation goals.
Another determining factor of reliability is the type of data that is collected. Surveys that include information on base pay as well as total cash compensation or even total direct compensation ensure that the most comprehensive pay picture is being provided.
4. Which jobs are included in the survey?
After determining that your survey’s data is reliable, the next step is to review the jobs included in the survey results. Job titles and descriptions can help you determine if the positions being reported on match the ones at your company and, in turn, allow for better data comparison. It is crucial to ensure that the description of the survey role and its functions align closely with the job description within your company since titles and duties can vary significantly across organizations and industries.
Review demographic elements such as employer size, industry, location, and revenue to determine if the survey aligns with your organization. If your company is looking for specific job titles, it may be beneficial to purchase a specialized survey to determine the compensation for a particular position.
Get the right survey for your needs
Compensation surveys can be a powerful tool for your organization, but ensuring you have the right one for your needs will make all the difference. These tips will help you get started in the right direction so you can feel confident making the right decisions for your business.
If purchasing a salary survey is not in your budget, Compensation Works has a fully licensed survey library to leverage with client engagements!
Want assistance finding the right compensation survey for you? At Compensation Works, we help organizations tailor their compensation and benefits plans to work for today’s competitive job market. Contact us today to learn how we can help your business.