Talking about money has a big impact on hiring and retention of employees. A recent CareerBuilder survey found out that only about 11% of employers display salary information when putting up job listings. More than 2,000 hiring managers and HR professionals, and 3,000 full-time US workers in the private industry were surveyed.
About half of the employers or around 48%, discuss salary expectations and other information during the initial job interview. The other 24% of employers who were surveyed said they for the final stage or the job offer before revealing the salary for the position. But what is so important about knowing these figures?
After the Job Offer and the Salary Package
About 49% of new hires accept the first salary offer the recruiter offers them. On the other hand, these employees are undervaluing themselves. Most HR professionals and hiring managers, according to the CareerBuilder survey, are actually willing to negotiate salaries.
This presents a potential risk in the hiring and retention strategies of companies that don’t take time to ask what a new hire really wants to receive for compensation. Survey reveals over 54% of employers are willing to talk about salaries during the initial job offer to prospective employees. Thus, a lot of potential hires or new hires are leaving money on the table by not even trying to talk about the salary. While this reluctance of new-hires to negotiate may save your company money in the short-term, it may cost manpower and the loyalty of employees in the long run.
It’s only logical to assume that majority of employees, even those afraid to negotiate, will want to move-up to a company that provides better pay, right?
Who is most likely to Negotiate?
Among the workers surveyed, a new hire’s willingness to negotiate the salary offer appears to be directly related with job experience or seniority. More than half, or 55% of the workers who are 35 years of age or older generally negotiate the first salary offer. This is higher than workers who are 18 to 34, because only 45% of them were willing to talk about the salary during the hiring and retention process.
Men were also found to be more likely to negotiate, about 54% of the men, as opposed to 49% of the women, negotiate first salary offers. Also, workers in the professional and business service industry tend to negotiate more, followed by those in the IT industry, the leisure & hospitality industry, and the sales industry at the last spot.
Basing the First Initial Salary Offer
Salary offers are based on competitors, too. One-third of the surveyed employers keep track of what other companies pay for the same position via job postings and salary benchmark websites like glassdoor.com. Another 34% said that they base it on market average reports. However, the remaining 35% don’t consider other external factors when it comes to compensation.
If your hiring and retention team doesn’t consider external factors, you’re missing out on a lot of things. You could be paying more than needed or paying much less, in which case the good recruits aren’t likely to come knocking at your doors.
Another Tactic: Offer other Job Perks if You can’t Compete Money-wise
Majority of employers give other benefits, such as health benefits, travel privileges, day-care vouchers, free meals and even discount cards when they are unable to meet a potential hire’s salary request. This is also important in hiring and retention of employees, because it shows that the management listens to its workforce’s needs.
The most popular alternative that employers offer is having a flexible schedule, as survey reveals 33% now offer flexi-time as a benefit. It’s pretty popular, especially with mothers and yuppies. Others offer more vacation time, telecommute options, or mobile device allowances. About 38% of employers, however, said they don’t offer any alternatives compensation options at all.
Hiring and retention of employees isn’t straight-out money vs. money competition. In the end, it all boils down to setting a fair compensation package for workers, one that meets their needs and is relative to the work they are asked to do.
