Job market intelligence

It is already a challenge to find the right person to hire, but once you find them, you still need to close the deal. Salary will always be a major factor in your negotiations.

Finding IT or analytics staff with specialized skills is a challenge. Hiring managers need to think about how a candidate will fit into a prospective team, but finding this candidate is just the beginning. Any smart prospective employee is evaluating your business in return and trying to determine whether he or she will be satisfied and successful filling in the position. For most employees, salary is still the bottom line, and recent surveys show that more and more job seekers are eager to negotiate and demand salary transparency in today's economy.

Expect more negotiation

 

According to a survey conducted by human resource consultancy Robert Half in the third quarter of 2018, "today's job seekers are confident in their bargaining power." More than half of survey respondents (55 percent) tried to negotiate for higher salary the last time they received a job offer. This is a significant increase compared to a similar survey conducted in 2017, in which only 39 percent of respondents had negotiated. (The survey includes responses from over 2,800 workers (at least 18 years old) employed in office environments and more than 2,800 senior managers at companies with 20 or more employees in 28 major U.S. cities).

The company's announcement of survey results noted that employers are increasingly willing to make deals with prospective employees. According to the survey of senior managers, "70% of senior managers said they expect some negotiation on salary. 62% are more open to negotiating compensation and nonmonetary perks and benefits (59%) than they were a year ago."

Clearly, if you're hiring but unwilling to consider a counter-offer, you're in the minority.

Who's asking and how

 

Not all salary conversations are equal. In the Robert Half survey, 68 percent of male employees tried to negotiate pay, but only 45 percent of women did the same. This may be due to the (real or perceived) possibility of backlash. For example, a study cited in a recent article from Harvard Law School found that "both male and female study participants were less interested in working with women who attempted to negotiate a better salary than they were with men who tried to negotiate a higher salary."

Salary negotiations are further complicated by the presence of companies that base decisions on an individual employee's salary history. There is a growing recognition that requiring salary history can amplify bias against women or other minorities who may be unwilling or unable to negotiate higher wages early in their careers. In an attempt to mitigate this, an increasing number of U.S. states and cities now prohibit employers from asking about salary history and protect employees' rights to discuss compensation openly.

Publicizing salary data

As more employees demand transparency in salary decisions, more employers should be conscious of how pay disparity makes them appear. Shareholder advocate Arjuna Capital recently identified 12 top banks and tech firms that it is challenging to release median gender pay gap statistics.

Identifying a gap in median pay between men and women can highlight where women are not being hired or promoted into positions that command greater salaries. Arjuna Capital managing partner Natasha Lamb explained, "For three years, Arjuna Capital has led the charge on 'equal pay for equal work' shareholder activism. But 'equal pay' is only half the story. Women are dramatically underrepresented in high-paying positions at nearly all major corporations. So, when more companies begin disclosing their 'median pay' gaps, the numbers are going to be shocking."

According to Arjuna Capital, the continuing pay gap is "not only bad for women, it's bad for the economy, and it's bad for the companies that can benefit now from their leadership and talent."

Closing the deal

 

Given the recent talent shortage in tech, how can you improve your hiring process? To keep pace with your competitors, you need to be willing to negotiate with new hires. Paul McDonald, senior executive director for Robert Half, points out that "job seekers with specialized skills are in high demand and may even be entertaining multiple offers. Smart companies realize that hiring top candidates before the competition does often comes down to moving quickly on hiring decisions and presenting a compensation and perks package that's at least on par with the competition."

The main takeaway for hiring businesses in a nutshell is to be up front with prospective employees about your salary and hiring processes and watch for sources of potential bias. That way, you can truly build a workforce that will be resilient and committed to your firm.

Author: Lindsay Stares

Source: TDWI

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