You have weighed the pros and cons of hiring some new employees and have decided to go for it. Now comes an even trickier decision – how much should you pay these people?
Figuring out pay scales and salaries can be a complicated part of running a small business. Salary surveys often don’t cover the kind of multitasking you are requiring for your small staff. And your competitors may be reluctant to share their salary information with you.
So how can you determine a fair salary that will attract experienced applicants without breaking your budget? Here are five steps to help you figure out what to pay your new part-time or full-time employees.
Create a Clear Job Description
If you want to compare apples with apples, you need to stop tossing a fruit salad. Is the position you are seeking to fill too broad? Narrow it down so that it will more closely fit what other companies advertise. List the specific duties and responsibilities of the position.
Are you ready to do some more online advertising and marketing? Begin by searching online for “web content specialist salary range ” or “content management specialist salary range.” Then narrow your search to your geographic location to find out what the local industry is paying for that job.
Check out ads posted on industry publication or trade magazine sites for similar jobs to see what the market is. Some industry publications publish annual salary surveys, and sites such as http://www.payscale.com let you plug in your job title and your location to get salary information for that job title. Examine similar job descriptions on sites like careerbuilder.com, jobs.com and monster.com.
After your online search, it’s time get local. You may have found a perfect match to your job description on the other side of the country, but you need to factor in your area’s cost of living.
You also can ask local friends and associates what they offer for a similar position in their companies.
Pick a Salary Range Instead of a Number
Now that you have a better idea of what to offer, think about a salary range instead of a set wage. If you advertise a salary range, you will broaden the applicants you reach. For example, if you advertise “Salary range $28,000 to $33,000, depending on experience,” you can interview candidates on both the high and low end of the scale and then decide if it is worth it or not to pay more for the more experienced candidate.
Consider Bonuses and Perks as Part of Salary
If your business is volatile or if you are just starting out, consider offering bonuses to compensate for a lower salary range. Employees understand market conditions and are often willing to take a less then top-of-the-market salary if they know they have a stake in the company’s success.
In addition, if your company offers other valuable opportunities such as flexible hours, parental leave or commuting discounts or passes, your candidate will take those perks into consideration when evaluating a salary offer.
According to a 2015 survey by Ernst & Young’s Global Generations Research, millennials say that they would take a pay cut, forgo a promotion or be willing to move in order to have a batter work-life balance. In the study of full-time workers in eight countries, one third of the 9,700 respondents reported that maintaining a work-life balance has become more difficult, with millennials and parents reporting they have been hit the hardest by the trend.
Once you and your applicant have agreed on a salary, it’s time to make that individual feel valued and valuable. The best employees feel that their work is important to the company. In other words, a fair salary may get them in the door, but good treatment keeps them there.