Designing and implementing a compensation strategy that is fair and motivating is a tricky but critical part of every organization’s HR operations. In order to make informed decisions about how to improve your approach, you need to leverage valid sources of information, and that’s where compensation surveys come in.
Accurate, relevant, and timely compensation survey results help tremendously when benchmarking your own organization’s compensation structure. However, for many companies and nonprofit organizations, it can be difficult to know how to kickstart the process of finding relevant and up-to-date compensation information or conducting these surveys themselves.
That’s where this quick guide comes in. In it, we’ll cover everything you need to know about compensation surveys, including:
- What is a Compensation Survey?
- Conducting a Compensation Survey
- Using Your Survey Data to Improve Your Compensation Strategy
- Partnering with Astron Solutions for Your Survey Needs
When properly conducted and applied to your organization’s current compensation strategy, compensation surveys can be a powerful source of information that ultimately helps you optimize the employee experience at your organization and boost retention.
What is a Compensation Survey?: An Overview
Also known as a salary survey, a compensation survey collects and analyzes actionable data on wages across an industry or specific role. This data provides key insights into job roles and their salaries, helping employers determine and create their initial compensation strategies, determine if their existing strategies are fair, and recruit competitively.
A compensation survey can focus on job titles, geographic regions, organization size, departments, industry norms, and more, and generally reports on cash compensation. The survey data is usually made up of quantifiable aspects of compensation like:
- Base salaries
- Increase percentages/amounts
- Merit increases
- Salary ranges
- Starting salaries
- Allowances and benefits
- Working hours
You can try to find existing compensation survey results through various professional sources, but it can be difficult to find one that takes into account all of your organization’s unique needs. Many nonprofit organizations and businesses turn to HR consultants and other outside experts for help administering custom surveys. These professionals will work with you to help create and facilitate the best survey to meet your needs.
Benefits of Salary Surveys
Compensation surveys can give you a key look into how other organizations are engaging with their employees. Specifically, salary surveys have the following benefits that HR leaders can take advantage of:
- Aid in salary benchmarking. The results of a compensation survey give you insight into what the highest and lowest salaries for a role in your industry are, providing you with a solid range of what you might offer your own employees.
- Help employers design a total rewards compensation package. A total rewards approach to compensation is crucial if you want to not only fairly compensate your team members but to keep them genuinely engaged and motivated to work. The total rewards philosophy takes a holistic look at compensation, encouraging employers to offer both indirect and direct forms of compensation to employees.
- Ensure employers keep up with salary trends. When you consistently review the results of compensation surveys, you have a better sense of what’s motivating employees in your sector at the moment. Try to keep up by actively participating in and obtaining data from salary surveys and re-evaluating employees’ salaries at least annually.
- Make sure organizations recruit and retain the best employees. With the right compensation and salary plan for each role, you can better attract the top candidates to your team. Regularly reviewing salary surveys can help ensure you’re offering competitive total rewards packages that keep employees engaged longer.
- Create a culture of consistency and transparency. When you are open and honest about referring to compensation survey data, your employees will know exactly where you’re getting their salary numbers from. Also, consistent use of survey data shows not only your team but also interested candidates that you are transparent and justified in your compensation plan.
Common Challenges of Conducting and Using Compensation Surveys
The benefits listed above may have you thinking, “Why wouldn’t I use compensation surveys?” However, there are some challenges associated with salary surveys, like:
- The time and money needed to create one. This is especially challenging if your organization is conducting a third-party custom survey made up of unique and niche job roles.
- Employer concerns. Direct wage information is sensitive data that no organization wants its competitors to have, and may violate anti-trust laws.
- Legality concerns. Revealing or barely concealing survey participants’ individual data is actually against the Department of Justice’s Anti-Trust Guidelines. Reputable surveys that follow the necessary legal guidelines can alleviate participant concerns in this regard. Options include buying survey reports from well-known companies that specialize in collecting and reporting data for their sector, or hiring a third party to conduct a salary survey for your niche sector.
- The use of bad market salary data. Bad data will likely lead to skewed compensation results. As a result, you’ll find it hard to attract viable job prospects and will risk looking foolish by advertising a salary range that is not in line with industry norms.
- Risks of turnover. It’s not good if a salary benchmarking mistake is discovered after an employee is hired, or if there is any adjustment (especially a downward adjustment) to salary. Without fair compensation, your team might experience dissatisfaction, poor engagement, and increased turnover.
How Much Compensation Surveys Cost
The cost of compensation survey data will vary widely based on the industry you’re looking at and the scope of the salary data that you want to use. For example, if you want access to survey results for a specific region, you may pay less than you would for data from an entire country.
Additionally, if you’re going to work with an external expert to conduct your own salary survey, your survey cost will depend on how niche your industry and job titles are, as well as how long it takes to gather the data. If you are planning on working with a third party, make sure to ask about pricing upfront.
If you’re looking for free resources to give you very general insights on compensation, here are a few to explore:
- The U.S. Bureau of Labor Statistics
- Job Boards/Job Descriptions
- Employee Reviews (from sources like Glassdoor, Comparably, or Indeed)
Who Can Help Your Organization With a Compensation Survey
If you’re looking to purchase access to salary data, ensure that you’re working with a reputable vendor that prioritizes legal and ethical research methods. If you’re looking to design and administer your own salary survey, consider working with a consulting firm that specializes in compensation, like Astron Solutions.
Conducting a Compensation Survey
Considering both the benefits and challenges listed above, a salary survey might not be 100% necessary at all times for all organizations. However, it can definitely ensure you’re fairly compensating and engaging your employees, which should always be a top concern.
If you’ve already decided that you’re interested in using a compensation survey, you’re probably wondering how to actually conduct one.
A customized survey that you conduct with the help of a compensation consultant is the best option. A customized compensation survey has several advantages, including:
- Being able to target competitors with the closest match to your organization
- Collecting the most current compensation data
- Specifying the exact information you want rather than digging through multiple generalized surveys to find what you’re looking for
- Ensuring legal compliance throughout the process
Conducting a third-party custom survey means you need to figure out the right audience to contact and come up with the key questions that will aid your organization. But, as you learned in the previous section, conducting your survey consists of more than just asking people how much they’re paid. There are legal and privacy aspects to consider, so it’s necessary to partner with a reputable service that can ensure you’re on the right track.
Using Your Survey Data to Improve Your Compensation Strategy
Once you have compensation survey data, you may wonder how to put it into action. Consider the following ways that you can use your data to level up your compensation strategy:
- Write or update job descriptions. Whether you’re recruiting new talent or clarifying expectations for individuals who are already employed in a certain role, salary data can inform what responsibilities and experience are linked to certain levels of compensation, empowering you to write job descriptions that are accurate before, during, and after the hiring process.
- Secure buy-in from leadership on changes to your compensation strategy. Much like your employees, your organization’s leaders need to know the “why” behind compensation strategy updates and adjustments. Survey data can back your decisions, and provide the evidence that your organization’s leadership needs to sign off on changes.
- Determine how to strengthen your compensation strategy with total rewards. You may discover that while your organization isn’t in a position to pay the most competitive cash salary, you can fill out your compensation packages with a more holistic total rewards approach that includes indirect forms of compensation such as traditional benefits, an employee recognition program, and special perks.
- Adjust compensation during performance review season. By frequently reviewing salary data, you can know the most competitive and fair compensation adjustments to make during performance reviews. And, you’ll be more prepared to tie those changes closely to performance.
The great thing about working with a compensation consultant to create and administer custom surveys is that you can also rely on their expertise to interpret the results and use them to make strategic improvements to your current compensation approach.
Partnering with Astron Solutions For Your Survey Needs
At Astron Solutions, we offer a variety of expansive HR consulting services, including creating and conducting custom salary surveys for organizations and associations in unique fields. With over 20 years of experience, we can help leaders like you with:
- Custom-developed surveys to address your unique compensation and benefits needs. We research industry trends and gain a collaborative consensus on the questions you want. Then, with a web-based survey tool, we’ll send out invitations to all of your potential participants.
- Confidentiality with your organization and employees. To protect participants’ data, we’ll report on collected information in averages and not release any organizational information to other parties. All reported fields are also only shown in group summaries. Individual responses are not displayed.
- Meeting all legal antitrust requirements. We are very familiar with the evolving guidelines surrounding compensation surveys. To comply with the Department of Justice’s current guidelines, data is only shown for positions and statistics soliciting five or more responses. Further, all survey data are a minimum of three months old.
- Detailed reports that go past survey results. Not only do we summarize the compensation survey findings, but we also document the data submission process, legal compliance, and guidance on how your organization should interpret the data. You can receive reports in PDF or access a secure password-protected website.
Astron Solutions works with you to not only create a comprehensive and detailed compensation survey but empowers you to take action with the results. According to National Director Jennifer Loftus,
Annual and quarterly ‘hot job’ salary surveys are a key part of Astron Solutions’ services. We take pride in working with associations and private employers to help them obtain the total rewards data they need, while ensuring legal compliance throughout the process. We very much enjoy conducting custom surveys!
Though they come with their own set of both benefits and challenges, compensation surveys can be a great help to organizations looking to take their compensation strategies to new heights. Use the information in this guide to determine whether using salary survey data is right for your organization at this time, and if you decide to conduct a custom survey, make sure to partner with the right consultant.
Looking for more information about the world of HR? Check out these additional resources:
- 2023 Compensation Trends Your Org Should Know About. Keeping up with compensation trends is essential for designing a strong compensation strategy. Read everything you need to know about compensation in 2023 in this guide.
- Nonprofit Human Resources: The Full Guide & Best Practices. Yes, nonprofits do need HR! Get an overview of human resources for nonprofits in this definitive guide.
- Working With a Nonprofit Human Resources Consultant: A Guide. Wondering how you can get the most out of partnering with a nonprofit HR consultant? This guide can help.
Leave a Reply