I often get asked the question, “How much do salary surveys cost?” and I usually reply with a question of my own, “How much do you think it will cost if you don’t use salary surveys?”
The answer is that you could spend between a couple hundred dollars and tens of thousands of dollars on salary surveys. I can see your reaction: eyebrows raised, jaw dropped, and the wheels turning… tens of thousands of dollars?!
I know this may sound like a lot, but the cost is minimal compared to your payroll, which is most likely the biggest line item on your balance sheet. If market data is used correctly the return on your investment could be priceless.
The Benefits of Paying for Salary Surveys
- Cost Control: Knowing the market will help you develop a compensation philosophy that will help drive your labor budget.
- Attract, Retain, and Motivate: Salary surveys are of course just one part of creating a total rewards package that will attract, retain, and motivate your workforce. Salary surveys help you stay competitive by guiding you to make sound compensation decisions to hire, promote, and provide merit increases and market adjustments.
- Compliance: Developing a market-based structure will help you stay fair and consistent when making compensation decisions that will protect you from discrimination claims. If you are a government contractor, Defense Contract Audit Agency (DCAA) will be looking for a compensation system that is externally equitable.
Before squashing the budget for surveys, consider how much you are spending on payroll and what effect the use of salary surveys could have on your bottom line. Most likely, your salary survey budget will be just a fraction of your payroll cost and you will certainly get every dollar back and some.