There’s an age-old question which divides many recruiters and key hiring decision makers: when advertising a role, should you include the salary range in the job ad?
Recent research from Payscale - the compensation data company - revealed that throughout 2020...
only 12.6% of global companies published the pay range for a role within their job ads.
What’s the logic here?
There is definite polarisation on this issue, so it’s important to unpack both sides of the argument and compile a list of how the lack or inclusion of salary in a job advert could affect the recruitment process.
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Attracting more/better candidates
The argument often seems to go like this: the higher the salary attached to a job advert, the more applicants there will be. And therefore by default of a greater pool of applicants, there is more likely to be a few top-tier professionals applying.
Conversely, if there’s no salary on the job ad, you are probably going to see fewer overall applications. But where the lesser candidates will be fixated on knowing the salary range and only apply to vacancies that state the remuneration, there will be some great candidates who are willing to take a gamble and apply anyway, and once they hear how amazing the role is, they’ll go for it, even if the remuneration turns out to be below their target package.
The primary risk of attracting candidates who sit well above or below the band (which is often a consequence when you don’t put the salary on the job ad) is that you’ll waste time wading through those whose experience doesn’t fit the bill, and will struggle to find the few who do.
Money is no longer the sole reason people accept a new job offer (granted it’s an enormously influential factor, but not the be-all and end-all); today professionals also value flexibility around their working patterns, the environmental/social impact of the business, and the non-financial benefits.
This has resulted in job seekers broadening their search horizons and starting their search based on what matters most to them. Quite often, this will draw them to roles outside their initial desired salary range.
Transparency may mean a slightly smaller pool of candidates apply to your roles, but those who do will be totally happy to accept the salary on offer, and are less likely to pull out or turn down an offer because the ultimate package is too low.
Visible salary = smaller applicant pool, but applicants are likely to be more engaged and likely to accept the position at the end of the process.
Our recent poll on LinkedIn appears to confirm this: 90% of 2,226 respondents believe that including the salary leads to more relevant applications.
Setting expectations up front
Needless to say, candidates can get frustrated if they think they are in the interview process for a role which falls within their desired pay range, and it ends up being too low. Flagging the range upfront eliminates this wasted time - and avoids burning those bridges!
Salary is much more than the money which hits your bank account - the salary attached to a role is a clear indication of the level and responsibilities of the position, and where it fits in the overall structure of the business.
While there are some deviations to the rule (e.g. the world of the start-up or scale-up, which may be very light on base salary, but involve unpredictable elements like equity), generally speaking a larger salary package means a more senior position.
If you are applying for a role based on its title, be mindful if the salary seems below what you would expect - it probably won’t offer the remit and seniority that candidate is seeking. Knowing where your current salary fits into industry averages is a useful tool here - use our salary guide to find out what companies typically pay for your role in your location.
Salary is not the only metric which can indicate the level of a role, but it is an important one.
Upfront declaration of salary avoids wasting time - yours and theirs - by ensuring applicants will have roughly the right level of experience for the position.
If a business sets an upfront salary (or range) when they are advertising a role, you essentially create an ‘anchor’ to which any future salary negotiations are tied.
If a candidate is earning significantly less than this range, they will still be focused on that number initially put forward, so many recruiters or businesses worry that they will be forced to pay more than the candidate would otherwise expect.
There’s a quick fix here: be transparent around exactly what parts of your ideal candidate's background or experience are absolutely necessary to warrant the top end of the salary range. “Yes, the ad says $150k - but for that, we are hoping for at least X, Y and Z.”
The salary stated up front should be adhered to where possible, but if circumstances change, or the perfect candidate can’t be located, it’s OK to deviate as long as good reason is given. Most importantly, the candidate should be made aware of why an offer might not come to the originally stated level.
Obviously, throughout the process, you can reinforce that there is scope for a pay rise further down the line. They may be willing to accept a smaller salary now if you commit to their progression in the hiring process.
The stated salary creates an anchor for negotiation, but isn’t binding on either party. There’s no point leaving salary off to try and pull the wool over an underpaid candidate's eyes - they will quickly see through the ruse.
This one applies less to an external recruitment agency, and more to those businesses which are directly advertising roles...
Salary information displayed on a job advert is obviously public information, and if there is any sensitivity around how employees are remunerated, this can cause issues.
There’s no quick fix here, bar examining internal business culture and why there has to be such a level of secrecy around salary is probably a good start. If the advertised role is paying well above or below its peers in the business, there’s either a good reason for that - or there’s an internal challenge to be addressed.
There is no simple solution, so the best advice would be to either state clearly in the ad why this role deviates from the internal salary structure. Or perhaps take this queue to examine internal transparency and conversations around staff pay.
To share some closing thoughts, and summarise the pros and cons:
Including a salary range on an advertisement:
- Attracts a smaller pool of candidates who would be more likely to accept a job offer at the indicated salary level
- Aligns the level and seniority expectations from the outset
- Anchors both parties to a range for negotiation
Hiding the salary range:
- Can prevent some awkward internal conversations about why this role pays more or less than its peers
- Might attract a larger, more senior, and more skilled applicant pool - but there’s no guarantee they will actually be interested or negated when they learn the real package available
Ultimately, the best approach you can take is to clearly establish the range with the candidate to ensure it meets their expectations to move, then take the conversation in a much more interesting direction towards the team, business objectives, development opportunities and growth!