Salary Survey Explained: Why Business Needs It?

Identifying the competitive advantages possibilities is one of the cornerstones of the business operation. In the grand scheme of things, conducting a salary survey are yet another piece of the puzzle that can become one if done right. 

That’s the case both for the companies and job seekers.

However, many organizations find conducting salary surveys challenging and don’t know to make the most out of them.

This year Talando conducts its 2023 salary survey, and because of that, we thought that we need to emphasize the business benefits of conducting salary surveys. This article will explain why salary surveys are important and how they benefit everyone involved. 

What is the Salary Survey?

According to Ruth Mayhew, the salary survey is a method of compensation and remuneration research that involves a variety of market segment studies aimed at exploring salary levels in a particular segment for specific or different types of specialists.

• The goal is to explore minimum and maximum salary levels across the market segment and determine the particular position’s median in a specific configuration.
• With this data, the organizations can determine the competitive edge of salary levels they can offer to the specialist applying for a specific position.  
  • For example, taking a look at the salary levels of middle-level DevOps with AWS cloud certifications and 6+ years of experience in SaaS. 

There are two different types of salary surveys:

• Internal salary survey – applied to compare salary levels and other aspects within the organization. It is primarily used to measure employee satisfaction and analyze the internal factors of employee engagement and attraction.
• External salary survey – applied to explore market situation within the industry to understand how to present employers’ value proposition (regarding salary and other aspects) for the job seekers and strengthen employee retention with up-to-date benefits.
  • Usually, companies relegate external salary surveys to third parties to maintain an objective outlook and avoid bias. 

Conducting salary surveys results in the following:

• Salary survey data allows structuring competitive compensation structures for the companies.
• This data also serves as a reference for job seekers to adjust their salary expectations.

Now let’s look at the mechanics of salary surveys.

How Does Salary Survey Work?

Overall, salary surveys gather salary figures of different specialists with various qualifications\experience. 

The critical aspect of survey data is that it concerned with non-identifiable quantifiable elements of compensation, such as:

• Base salaries;
• Salary ranges for the positions;
• Percentage of salary raise/decrease throughout the niche;
• Type/scope of incentives and bonuses;
• Various allowances and employee benefits;
• Work schedules / remote-office;

Besides, such surveys explore the context surrounding them, the contributing factors for salary levels, such as the company’s size and niche. 

• That’s how Talando usually conducts salary labor market surveys.

Exploring context is an important aspect, as it allows understanding the reasoning behind this or that salary level in a specific environment. 

• For example, studying the expertise and certifications for high-demand senior-level solution architects for PaaS companies. 

Overall, a detailed salary covers specialists’ wages throughout the niches. Besides, it explores the following aspects of remuneration and compensation:

• Correlation between the salary and experience level; 
  • For example, how much a junior level ML engineer can get in comparison with the senior level;
• Influence of certified expertise on the salary level;
  • For instance, whether a cloud engineer with Google Cloud certification can contend for a higher salary than a cloud engineer without such or other credentials;
  • In addition to that, language skills are critical for higher remuneration in some niches (especially in the case of international or EU/USA-oriented companies). It is essential for managerial and team lead roles;
• How salary level reflects the size and scope of the company in its industry niche (or in general); 
• inter-departmentally
• The interpretation of the job title or position in the companies of different sizes, niches, etc. (this aspect is usually explored through additional survey question dedicated to the topic);
• Specialists’ earnings in various geographic regions. 

Let’s take a closer look at salary survey benefits.

Salary Survey Benefits

The main benefit of conducting a salary survey is the reference data for well-informed decisions regarding compensation, remuneration, and other employee-related activities.

It provides HR departments with comparison data for a critical look at the state of compensation/remuneration politics with the organization and its influence (both positive and negative). 

Based on the Talando past salary survey project – we can see the following business benefits:

• Hands-on data for salary benchmarking

  • The foremost goal of conducting a salary survey is to get relevant data on salaries within the niche. 
  • This data helps adjust the company’s own benchmarking and maintain its competitiveness in the market – for instance, the highest and lowest salary ranges and candidate expectations. 

• Better total rewards compensation package

  • Fair compensation is one of the critical factors in retaining and motivating employees. 
  • However, it is hard to keep it on the level without attaining up to date market data regarding comparable compensation packages. 

• Ensure keeping up with salary trends in the market segment

  • The other significant benefit of conducting salary surveys is that you can see the dynamics of various salary trends within the market segments. 
  • Continual gathering of such data can help predict where things are going. This data will help determine which aspects to adjust or transform to remain competitive, attract new talent, and retain employees.

• Up-to-date market data = recruiting and retaining the best employees.

  • The employer value proposition based on relevant market data is a useful tool in attracting and retaining talent. It is a good starting point for candidate engagement. Further down the line, it also helps to retain talent and motivate his growth within the organization.
  • Knowing what drives job seekers, what they expect from potential employers, and what drives them to commit really helps recruiters fine-tune an effective hiring process. 

• Salary surveys = transparency

  • The company referring to salary surveys and other research types in its decision-making, is a trustworthy foundation for decision-making. 
    • That is especially so if the research is handled by the disengaged third-party. In this case, the goal is to get “cold facts” without a bias semblance. That’s critical for the balanced view of the market.
  • Employees need to understand where the company is getting the figures from. They also need to understand how the market situation contributes to their compensation. If that’s the case, such transparency undoubtedly contributes to their employers’ trust and boosts employee retention.

In conclusion

When done right, salary surveys are instrumental for the companies in retaining competitiveness in the market segment. 

In addition to that, conducting salary surveys and sharing its insights is a good way of maintaining the market’s transparency. Presenting salary surveys keeps every market player up to date with what is going on in their niche. On the other hand, salary surveys help to understand the offering’s fairness in the grand scheme of things.

Because of that, if your company needs a Ukrainian IT segment salary survey or wants to explore salary ranges within specific niches – contact us, and we will help you.