The benefits of salary benchmarking in recruitment
Kayleigh Bradley, senior recruitment consultant at GCA discusses how salary benchmarking can help give aftermarket businesses that competitive edge in terms of employee attraction and retention.
As a recruiter, one of the most common questions I get asked is about salaries and benefits. With the job market constantly evolving, companies need to ensure they’re offering competitive salaries to attract the best talent. However, with so many factors influencing salary levels, including regional differences, specific skill sets (such as language proficiency or experience with particular software) and market trends, it can be challenging to stay on top of what’s current.
This is where salary benchmarking comes into play. Salary benchmarking involves assessing market trends to compare salary data, helping companies ensure they’re offering competitive pay. So, what are the key benefits of salary benchmarking?
- Competitive salaries: Attract and retain top talent
By benchmarking salaries, you ensure your compensation packages are competitive, making it easier to attract highly skilled candidates. Moreover, offering the right salary is crucial in retaining your best employees. It makes sense: when people feel they’re paid fairly for their skills and experience, they are more likely to stay with your company.
- Informed decisions: Stay ahead of the market
Salary benchmarking takes the guesswork out of salary offers. Instead of relying on outdated or generic salary data, you’ll have access to current, accurate market rates. This allows you to make data-driven decisions when making job offers, ensuring that you are offering a fair and attractive salary package.
- Employee retention: Reducing staff turnover
Salaries are a significant factor in employee satisfaction. When your company offers competitive salaries, employees are more likely to remain satisfied with their roles, reducing the likelihood of high staff turnover. Lower turnover means less time and money spent on recruitment and training, contributing to long-term organisational stability.
- Budget planning: Accurate forecasting
Up-to-date salary data is essential for effective budgeting. With accurate insights into the going market rates for specific roles, you can forecast your compensation costs more accurately, leading to better financial planning. This proactive approach helps prevent unexpected salary-related expenses down the line. Salary benchmarking can also help your business save money – market rates aren’t always higher than your anticipated offering.
HR Manager’s perspective: A real-life success story
We recently conducted a salary benchmarking project for a leading parts supplier, and their HR Manager shared valuable insights about the experience: “From my perspective, by coming to you to carry out salary benchmarking for a particular role, it ensures that we are targeting, attracting, and securing the correct, most suitable candidates for our position, which hopefully ultimately means also that we will retain that good talent! In turn, it also makes the whole recruitment process far easier and quicker to undertake.”
Conclusion: Making informed compensation decisions
Salary benchmarking is an essential tool for companies looking to make informed compensation decisions. By utilising up-to-date market data, you can ensure your salary offerings are competitive, attract the right talent, reduce turnover and streamline your recruitment process.
In summary, salary benchmarking helps you manage compensation effectively, ultimately supporting your business goals of talent attraction and retention.
If you’d like to discuss your recruitment strategy in more detail, get in touch!
