We all remember Jerry Maguire right? One of the better performances Tom Cruise has given in his career. One of the things that made the film so memorable were two great catchphrases. “Show me the money” was one of course, and another less quoted but equally brilliant phrase “you had me at “hello.”
One of the great Australasian HR/recruitment mysteries is why we don’t put salary ranges on job ads here. Why are we not showing people the money? It’s standard practice in the UK for example. Look at any job ad or job board and 95% of roles have a clear and narrow salary range so you immediately know as a job seeker whether it is something you are prepared to consider and whether it will meet your expectations.
In little old New Zealand, we don’t talk about salaries in 95% of job ads. One of the most frustrating things I’ve found when I have been a job seeker is that you always have to ring up and ask what they are paying, to which you usually get the standard answer “it depends on the skills the person brings to the role.” This is of course bullshit. No one ever advertises a role without first having a good idea of the range in which they are prepared to pay. And even when they tell you, they will only give the information away after finding out who you are and your level of experience. It’s like they have to be satisfied you are a serious contender before they will share that with you.
Is it a national trait? We do the same thing with houses. Everyone has an idea of what they want when they are selling, so why not just say so? Why have all this “buyer enquiry over” nonsense? Put a fixed price on it. If there is demand for the house, buyers will offer more anyway to secure it. People waste far too much time house hunting as a result of this sort of nonsense.
So why are we so coy about saying what we want to pay? Is it fear of missing out on a potential candidate? Giving too much away to competitors? It baffles me so I asked around and sought comments on LinkedIn. I thought surely the benefits of giving this information away outweigh the negatives?
So what did I find? Here is a summary of the comments:
• Showing a salary range will make the responses to the ad more relevant. Over-qualified candidates are less likely to apply as are way under-qualified candidates (this from a company that actually includes ranges who consider it’s working for them)
• It gives people a better sense of the level of role and whether they are the target profile for a position
• It avoids getting a long way through the recruitment process only to realise the person’s salary expectations aren’t going to be met (it happens a lot here and then you just get turned down or people withdraw from the process – wasted time and effort for all)
• You get an idea of the value the organisation itself places on the role being advertised against the responsibilities
• Recruiters currently waste too much time fielding calls and talking to candidates who aren’t right for the role. This would allow them to work smarter and narrow the field quicker.
No one mentioned any negatives and all said the same thing “I always wonder why we don’t do this.” Is this sort of information really that commercially sensitive? It’s not hard to find out what your competitors are paying anyway.
So as a job hunter might say, if you want me at “hello”, show me the money. Say it with me Jerry “SHOW ME THE MONEY!!!!”
26 thoughts on “Show me the money!!!”
Here’s a thought:
The role may exist within the organization with current incumbents. These incumbents may, for whatever reason have variance of salary rates between them, and/or with the incoming hire.
This opens potentially unwelcome negotiations with incumbent staff.
Great point Michael and I agree to a point. However, this also raises for me the question of transparency around remuneration and benefits. I think we need a more open approach instead of the smoke and mirrors most organisations apply.
Oh I agree.
However often I find that organizations are on some kind of transition either preceding a wage industry analysis, in the middle of a wages realignment, etc.
The critical thing really are handling incumbents who, the organization may have to deal with back pay requests fairly or not. You’ll have otherwise engaged employees realizing that they could have been making more and now want justice, heh, etc.
I’d rather that all compensation and rewards policies are transparent, but I’m not sure everyone has to know what everyone else used to make, or their performance rating in particular for that matter.
Just thinking of managing everyone’s perception of everyone else makes me cringe.
If you advertise a range you can have the difficulty of managing expectations. Nearly all candidates view themselves as above average so will have the top of the range in their sights. Sorry, but in real life there is an “upper quartile” for a reason. When you know the rem won’t move, advertise it. Cant find what you want, change the rem and re advertise.
First, no need to pretend smoke and mirrors actually work. Among colleagues salaries are exchanged over coffee or a beer so why not be more transparent.
Second if you cannot justify the difference in salary between what you are willing to pay a new hire ad an incumbent then you have another problem then a recruitment problem. You are then probably trying to keep the cost down if not to underpay current staff.
And last, have you ever decided to take or leave a job for the pay? If your answer is yes it is apparently one of the most important factors in making the decision. Hiding this information will only postpone the same outcome.
I am with Iain here. Advertise what you are willing to pay and increase if you need to find the right quality.
Just common sense approach really!
Completely agree with your points here – advertise what you are willing to pay and increase if you need to!
Agree – start a trend! In Uk we have no problem managing candidate expectations around salary – there are straightforward techniques to do this (happy to expand) and as you say, most jobs have salaries attached. In fact in Uk you get far less response if you don’t advertise a salary indicator.
That’s what I thought. Thanks Jane
If you advertise a role for 90-100K and there is a candidate currently earning 105K they are unlikely to apply for the role, yet that candidate may bring twice as much to the role as anyone within the range. Until you talk to that candidate you will never know their situation ie your office might be next door to them so no travel costs ie 100K salary + location becoming more attractive. You could sub the location example for any other perceived benefit too. If they don’t apply you don’t get the opportunity to qualify their situation. You are giving people a reason to opt out early when (as the above comments suggest) you may end up paying more anyway. Plus what happens next week when you open a role that can pay 110-120K – wouldn’t it be great to already have the person on your books (or using the latest buzz words; in your talent pipeline / community)
Good points David, but I guess it comes down to how good your recruiters are. The good ones will also be out targeting people, not just waiting for the CVs to roll in. If someone is really that good and offers twice the value, they would probably not find the role that challenging. And if they were really interested in the role, I’m sure they would apply assuming it’s not about the money.
We spend a lot of time worrying about how we attract the right people. I favour a more transparent approach on the basis that the right person will apply for the right reasons. If someone wants more money they will either not apply, or will apply on the basis that they back their skills and their ability to negotiate for the salary they need. The second scenario indicates an attitude that I think is more likely to add value.
We spend a lot of time pussy-footing around issues related to money, being coy about what we want/can offer. With all the information people and organisations can make good decisions for them at the time.
Agree Shona. And I am always surprised how few people here negotiate on salaries and benefits!
Shona I most definitely agree. It is up to the candidate if they want to apply. If they feel they are worth $105k and the advert is only for up to $100k then they can either skip the role as it may not be challenging, as Richard said, or apply and negotiate. You can always contact the company to see if there is room for movement above the range stated if you are really interested in the job. But stating the salary range is a good guiding factor. It’s easy to manage expectations when it is clearly set on the job advert. It’s just that companies can’t be bothered or are too passive to actually manage them.
Different businesses reward staff in different ways, what makes up a salary range at one firm is not the same at another. Its comparing apples to oranges – hence you need to be having the conversation with the candidate, understanding their drivers. Tash it doesn’t have anything to do with companies not being bothered or being too passive. You cant always contact the employer, if you look on a typical job posting 90% of direct employers do not put any contact details on their ads – if were talking about transparency put someones contact details on the ad (coincidentally 90% of agencies have their contact details on the bottom on their ads).
I’m not saying avoid the conversation / transparency – it is so important, but you need to be in a position to have that conversation. You would be amazed at the reasons people give for applying or not applying for a role.
I might be cynical, but when employers in UK don’t put salary on ads and then ask you for your current salary, I think they use it to keep their costs down. If you are earning less than they thought they would have to pay, they can pay you less. Surely each role has a value regardless of the successful candidate’s current salary! Patty the rate fir the job, not what you can get away with!
Exactly. It’s all a bit “what are you paying?” “We’ll, you tell us what you are looking for.” Not very satisfactory for either party. I once enquired about a regional “HR Manger” role and was told they were paying $60,000. If you are familiar with the NZ market you will know how ridiculous that was, and just how much difference there often is between the job title and reality which is a whole other issue!
Remuneration is only one of the variables in people’s decision making, though an important one. If a candidate feels that the role is right for them they will usually make an enquiry, though not if the remuneration is too far from their ideal.
Ranges are dangerous. Typically an expectation gap is established as soon as you put in a range; if you quote $90 – 100 – often the employer is thinking $90 and the candidate $100. If it is a range, do make it narrow or use ‘circa’ c$100k (“dependent on experience” can be your get out of jail card).
As a recruiter, I would prefer to put in remuneration where possible.
I very much think that the NZ/Aus job market, its employers (and candidates) would be better served being more open about what the salary for a position is. As the post advises, it works well in other markets. What is to fear??
Getting good candidates is not easy and I would certainly argue it is made more difficult if salaries are not shown as the candidates will not be sure what the expectations are.
Put bluntly it does not in my view encourage good candidates already in jobs to switch roles as more effort is required to find out if the role/employer is worth applying for. Good candidates don’t want to end up in application process for a job they find out later is paying them less. I would also argue it also does not show most of our employers in good light as the implication is that they may have widely differing salaries being paid to staff doing the same role. It is not exactly an open way of working is it…?
I can only see one group whom it may serve and that is the agencies as they are able to make more of their brokerage role and field candidate enquiries. Perhaps this helps explain why the local markets here are awash with agencies doing search and little further added value recruitment/HR based services.
I do hope others enter this debate and put their view forward. For the record and before I get flamed I know several people in good agencies that despair of the enquiries they get and would also like to see a more open way of working in this market.
Lets be open – show the money – the sky wont fall in.
Thanks for your comments George. Good stuff. I was alarmed to see a few months ago a recruiter bragging online about how he had got the employer (his client) to pay more than the candidate was asking for and no doubt boosting his fee in the process. More parallels with real estate I think! Would love to see more transparency all round.
Prices aren’t on houses because if you price it people want it at less. If you don’t price it they might offer you something better than you thought. Not pricing gives you a chance to an unlimited win, pricing it limits your win. Same with job ads except the payoff is quality of candidate vs. cost. You can’t argue with how good this practice is because salaries in NZ are lower than anywhere in western world so companies are doing a good job at keeping them low while getting the quality they want. From an employers perspective the UK should be following us.
But it doesn’t surprise me that most people on here think it should be on the ads, all the comments here seem to be as job-seekers. Having to pay for higher salaries isn’t a concern. Not having that concern is the difference between running your own business and being an employee.
Great points Steven – a house is worth what someone will pay for it.
So the UK should turn itself into a low wage economy? Successful businesses know how to attract good staff and it’s not through paying peanuts for monkeys. And most of our talent goes offshore in search of decent wages. I can’t see how that benefits the country.