There has been much discussion about pay transparency recently especially given the fact that several states and localities are implementing new laws in this area.
Earlier this week, The Society for Human Resource Management (SHRM) released new research detailing how organizations are approaching pay transparency.
Some employers have raised concerns that listing pay ranges may lead to negative outcomes such as candidates not taking the total compensation into consideration, but SHRM research shows most organizations that list salary ranges lead to favorable outcomes.
Around 42% of more than 1,300 HR professionals sampled said their organization operates in a location that requires pay ranges to be included in job postings. When not required by law, however, over two in three (67%) HR professionals say their organization voluntarily lists start pay in their job postings sometimes, often, or always. What’s more, 32% of these organizations began including start pay information in their job postings within the past year – signaling some employers may be planning ahead in anticipation of new pay transparency trends.
“The path toward equity requires more than recognizing that there are systemic gaps that adversely impact one group over another and then addressing them proactively,” shared Emily M. Dickens, SHRM’s chief of staff and head of public affairs, in a statement. “It requires more directed education on the compensation process, increased engagement with compensation specialists and HR professionals, and an understanding of how to leverage one’s talent through personal advocacy when armed with this information and allyship within the organization.”
Additional key findings include:
- 70% of organizations that list pay ranges on job postings say that doing so has led to more people applying to their postings.
- Nearly two-thirds (66%) of organizations that list pay ranges on job postings say that doing so has increased the quality of applicants they’re seeing.
- 65% of organizations that list pay ranges on job postings say that doing so makes them more competitive in attracting top talent.
How Pay Transparency Influences Applicant Behavior
- 82% of U.S. workers are more likely to consider applying to a job if the pay range was listed in the job posting.
- 74% of U.S. workers say that they are less interested in applying to job postings that do not list a pay range.
- 73% of U.S. workers are more likely to trust organizations that provide pay ranges in job postings than ones that do not.
When considering pay transparency in job postings, organizations will also need to prepare for how doing so may affect current employees.
- 36% of organizations said this change caused more current employees to ask about receiving a pay raise.