First and foremost, I recommend NOT using free data on the internet. It’s worth exactly what you pay for it. Your compensation program should have a policy to only use professionally prepared and vetted surveys. More than likely you will have someone come to you and say “My neighbor has the same job I do and he gets paid $5,000 more a year than I do.” That may well be true. The neighbor may also have sub-par benefits, no incentive plan, be a long-term nephew of the owner, etc. The correct response to this is we can’t conduct a cohesive compensation program with unconfirmed data points of individuals. You should also not rely on websites that offer free compensation rates for a given title if you go in and put in YOUR pay for that title. Matching a title, with no idea if the responsibilities are the same, is irresponsible compensation work. More so, you don’t know if the person who entered their data included their overtime, bonus, worked full time or part time, etc. or perhaps enhanced their own data. Good compensation practitioners use only third party aggregated data from a trusted source. It’s actually illegal for an organization to conduct their own salary survey, and solicit wage information from their competitors. Your best data and legally appropriate source is professionally published salary surveys.
Industry surveys are specific to very tightly defined industries: health care, insurance, etc. If you are in an industry that has a survey, it will be invaluable to your industry specific jobs that might not be covered in a general survey, and it will have those inter-industry support roles like accounting and HR as well. If you are in an industry that doesn’t have an established industry survey, and your jobs are unique to your industry, you can commission a survey of specialty jobs. An example is an ice cream manufacturer in the Midwest who wanted to price “assistant cheese maker.” This is not a job that is going to be in a general survey. Another example was a progressive technology company in the Midwest needed a competitive salary rate for an “Idea Realization Process Director.” Sometimes if the job you want to price is more prevalent in another part of the country, you can investigate local surveys for that area. Pricing someone who evaluates new technology ideas and manages their examination for viability might well be in a local survey of a technology hub area.
General surveys can provide extensive data, but are pricey! Most of the serious survey vendors are on line now, and their data is remarkably easy to use, but to update your surveys from these sources every year can get expensive. Compensation experts recommend you age your survey data no more than two years forward. So if you subscribe to two or three major survey providers, you might buy each product every three years, and age the other two so that the data is “apples to apples” for date validity.
Custom surveys can be pricy, but might be your best option. You can enlist the assistance of a professional compensation consulting firm like Ramsey Associates to provide that arms-length distance to make it legal, working from a list of potential participants you identify. If you are that ice cream manufacturer mentioned above, a third party survey vendor such as Ramsey Associates can work with you to compile a list of all the organization that might have jobs like your, prepare the questionnaire, solicit participation, compile data, and provide results. Participants other than the hiring organization would pay a fee for a copy (which they probably need also), which would defray the cost to you. A custom survey a consulting firm charges $10,000 to produce can be provided to other participants at $500 apiece, offsetting your fees and creating an industry standard. A good place to inquire if a survey like this already exists is a professional industry affiliation group. There is a professional affiliation group for almost every organization. There is even a National Dairy Goat Association! Check there first, and if they’re not sponsoring a survey, they might be a great partner in reaching other members who might want to participate.
So – survey season is beginning. Early spring is when the collection of data occurs, summer is when the vendors are compiling the data, and fall is when they are typically published. This coincides with typical October budget preparation, and organizations want to know if and how much they should adjust their salary schedules.
Watch for the fall article on survey data aging and compiling data from multiple sources. If you need assistance in submitting data, evaluating surveys, or pricing your organizations jobs, Ramsey Associates can help.