Salary benchmarking is the process used by a business to identify, track, and compare similar salary rates to determine the pay package for their employees. In terms of HR, salary benchmarking is essential for comparing the pay and benefits on offer against those offered by competitors.
Salary benchmarking enables companies to compare salaries and benefits within specific industries, professions, and levels. It is fundamental to any organisation, directly correlating with higher staff retention levels.
Through salary benchmarking, businesses can make accurate, impartial, and non-discriminatory remuneration decisions that positively contribute to their future development and sustainability.
Benchmarking also matters to employees as it clarifies whether or not they are being paid their market value. As it is essential to retain high quality employees it’s vital that businesses hold on to their top performing staff.
For instance, if a company has a competitor that is offering more attractive salary packages, then this is likely to pique employees’ interest. However, through regular salary benchmarking, your business will be in a better position to retain its employees by ensuring that you are paying competitive and market rate salaries. This, in turn, will reduce costs, increase overall productivity, and improve employee morale.
Organisations can also focus on different components of remuneration in order to create a tailored salary and benefits package for each department or individual. This helps to nurture valued employees and ensure they stay with the company for longer.
In summary benchmarking is important for organisations and employees of all levels within a company – particularly when customised to a specific organisation, industry, or role.
Salary Benchmarking at GRS
At GRS, we understand the challenges faced when it comes to attracting and retaining top human capital.
As part of our services, we offer a generic salary survey covering a range of professions and levels, which is published annually and available to download for free. We also offer a bespoke salary benchmarking service. Through this service, companies can give us specific parameters, such as time period, industry, job titles, disciplines and more.
Using data from our database, we perform thorough research to compile an in-depth report detailing low, medium, and high salaries for each position that has been mandated to benchmark.
Our reports allow businesses to compare their current remuneration packages against their industry competitors. This enables them to identify strengths and weaknesses in how they reward their personnel and adjust remuneration accordingly.
By analysing market trends in salaries, your organisation will be ideally placed to offer competitive remuneration packages that contribute to greater employee satisfaction – and therefore retention levels.