Paying the market rate – How to do salary research

January 1st, 2015

Advertising a job with the right salary will be one of the key determinants of a successful recruitment campaign. The correct salary will allow you to position the role in the market, showing candidates the level of experience and expertise which you want.

This article will explain how to conduct salary research, by the end you will have a good understanding about what needs to be considered when setting salary levels.

Each job has a salary range which is determined by the job market.

For each job, the salaries paid to everyone in the market doing that job will most probably be distributed in the following way:

basic salary graph

When setting the salary level for your role you have both strategic and operational choices to make.

1.    Do you want to try and recruit someone cheaply
2.    Do you want someone who will excel and who is highly trained already (higher salary) or someone who will be able to do the job but will need to be trained in order to become very competent (lower salary).
3.    If you have other people working in your company in the same role, what are their salaries and how will setting the salary for your new role affect the existing staff if they found out what it was.

Given that generally the best people will go after the jobs with the best salaries in the market, if you want to recruit someone exceptional for your role, it will be important for you not to pay below the average.

Whatever approach you decide, if you are going to try to recruit for a position it’s important to first find out what the salary distribution curve is for the job you are going to advertise. Salaries will change in response to economic conditions and other factors like inflation.

A good way to start is with websites which compare salary information, benchmarking salaries in a specific region or sector.

For a straightforward and simple site which has relatively up to date information monster.co.uk has a free salary advice service available here. This allows you to see very generically the amounts paid for a particular job in a specific location.

salary graph
So for a London based Project Manager the salary distribution curve would look something like the below:
pm salary curve

Listed below are some other methods which you can use to verify you have selected the right salary level.

Search online job postings – This can be the simplest and the easiest way to check salary ranges.  The advertisements on a site such as www.monster.co.uk will give you detailed descriptions of jobs and salary levels for almost any role.

Contact a recruitment firm – if you contact a recruitment company which specialises in your company’s sector they will be able to advise you on the current salary range and the level of candidate which it will attract.

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