Ruth, Bill, & Russ are joined by Amy to review the 2023 Payscale Compensation Best Practices Report (CBPR) and share their insightes. How are things changing as we move into Q2 of 2023?
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[00:00:04] [SPEAKER_03]: And we're live!
[00:00:24] [SPEAKER_03]: Welcome back to Comp and Coffee, everyone excited.
[00:00:26] [SPEAKER_03]: This is my favorite episode of the year because we get to talk about CBPR and if you're
[00:00:31] [SPEAKER_03]: new to Comp and Coffee, you don't know what CBPR is going to get all into that.
[00:00:35] [SPEAKER_03]: Because today I'm joined by Ruth and Bill and Amy, special guest who's been on the show
[00:00:41] [SPEAKER_03]: several times now.
[00:00:42] [SPEAKER_03]: And Amy is our, I don't know Amy.
[00:00:46] [SPEAKER_03]: I know you have really cool title about associate director content marketing but really
[00:00:49] [SPEAKER_03]: I think of you as the CBPR guru.
[00:00:51] [SPEAKER_03]: Is that fair?
[00:00:53] [SPEAKER_03]: Is that a fair characterization?
[00:00:55] [SPEAKER_00]: I will go ahead and accept that.
[00:00:57] [SPEAKER_00]: I think the more formal definition would be the author of the report.
[00:01:02] [SPEAKER_00]: Fine, sure.
[00:01:02] [SPEAKER_03]: Okay, fair enough.
[00:01:03] [SPEAKER_03]: A author guru.
[00:01:05] [SPEAKER_03]: Yes, so Amy helps to make sure this thing happens and she's an amazing
[00:01:12] [SPEAKER_03]: audience.
[00:01:13] [SPEAKER_03]: But also so many of our clients are amazing because they participate in this thing, not
[00:01:16] [SPEAKER_03]: just clients.
[00:01:17] [SPEAKER_03]: Everyone in the industry, it would make this report so exciting for folks like Bill and Ruth
[00:01:22] [SPEAKER_03]: and myself to read and I'm sure Amy gets great.
[00:01:25] [SPEAKER_03]: Jeave Joy putting it all together is we have so many amazing participants because the
[00:01:30] [SPEAKER_03]: 2023 report, I believe Mark's the 14th annual running of this report by Payscale.
[00:01:36] [SPEAKER_03]: And it's the largest known survey of its kind.
[00:01:39] [SPEAKER_03]: This year we had like almost 5,000, 4,900 and some odd confessional jump in there.
[00:01:47] [SPEAKER_03]: HR leaders business execs.
[00:01:50] [SPEAKER_03]: We run this thing usually in Q4 of the year so this would this represent to
[00:01:53] [SPEAKER_03]: data you're going to hear about today represents the time period from October 22 through
[00:01:59] [SPEAKER_03]: December 22.
[00:02:00] [SPEAKER_03]: So super excited.
[00:02:03] [SPEAKER_03]: You can be with us today Amy to share all this and of course we'll ask Bill and
[00:02:06] [SPEAKER_03]: Ruth for their thoughts as Amy shares her insights.
[00:02:09] [SPEAKER_03]: But Amy has wanted to just dive right in what were some of your key takeaways you're
[00:02:13] [SPEAKER_03]: putting this together, what things were like the late folks started going off for you?
[00:02:17] [SPEAKER_00]: Every year when you CBR we look for an overriding theme and I think this year we have a
[00:02:24] [SPEAKER_00]: lot to pick from because 2022 was just talk full of interesting things in the compensation
[00:02:31] [SPEAKER_00]: world.
[00:02:32] [SPEAKER_00]: But the thing we landed on was really the kind of ongoing or a topic recently resurrected power
[00:02:38] [SPEAKER_00]: struggle between what employees want and what employers are trying to do for their
[00:02:43] [SPEAKER_00]: businesses.
[00:02:44] [SPEAKER_00]: And this tug of war is highlighted in things like pay transparency legislation, the
[00:02:50] [SPEAKER_00]: fluctuating labor market, increased employee demands for compensation benefits, inflation,
[00:02:56] [SPEAKER_00]: just a lot of things that are concerning I think to HR leaders in COP pros are covered
[00:03:02] [SPEAKER_00]: in this report and it's a very interesting one.
[00:03:06] [SPEAKER_03]: Yeah, that's I want to dive right into this because you know the economies in a certain
[00:03:10] [SPEAKER_03]: state right now and so we sort of expect the labor market and the employment sort of
[00:03:16] [SPEAKER_03]: recruiting and retention to be a certain way when the market is a certain way and I'm really
[00:03:20] [SPEAKER_03]: curious because it feels to me like everything's not kind of behaving as you'd expect
[00:03:24] [SPEAKER_03]: and so what were some of the labor challenges you started seeing the surface as you
[00:03:28] [SPEAKER_03]: started pulling this together?
[00:03:30] [SPEAKER_00]: Well, I love how you described our economy as a certain state because that's perfect
[00:03:34] [SPEAKER_00]: to me.
[00:03:35] [SPEAKER_00]: What is that state?
[00:03:37] [SPEAKER_00]: That is the question.
[00:03:39] [SPEAKER_00]: Yeah, I think everyone that's been watching this evolve over the past year and recent
[00:03:45] [SPEAKER_00]: months would answer it in the same way.
[00:03:48] [SPEAKER_00]: We don't know what's going on with the economy right now.
[00:03:50] [SPEAKER_00]: We are seeing a lot of news and speculation that we are possibly going to go into a
[00:03:56] [SPEAKER_00]: recession but I read articles about this every day that has it going back and forth from
[00:04:01] [SPEAKER_00]: recessions going to be deep.
[00:04:03] [SPEAKER_00]: It's going to be mild.
[00:04:04] [SPEAKER_00]: We're not going to have one at all.
[00:04:06] [SPEAKER_00]: And what we're seeing from our report that data that we collected asking compensation
[00:04:11] [SPEAKER_00]: professionals and HR leaders to comment on how they're experiencing the economy in 2022
[00:04:17] [SPEAKER_00]: and what they face 2023 is going to be like, what we are seeing is that voluntary turnover
[00:04:22] [SPEAKER_00]: rates have gone down.
[00:04:24] [SPEAKER_00]: So we're coming out of the great resignation where voluntary turnover rates were extremely
[00:04:29] [SPEAKER_00]: high.
[00:04:30] [SPEAKER_00]: They're 36% on average and they've gone down to about 25%, which is still higher than
[00:04:37] [SPEAKER_00]: most organizations want in an ideal world but reflective more of kind of what's normal
[00:04:43] [SPEAKER_00]: for organizations and that's definitely having an impact on retention when it comes to
[00:04:49] [SPEAKER_00]: being able to hang onto your current employee workforce.
[00:04:54] [SPEAKER_00]: But it does vary by industry so some industries are going to have higher turnover rates
[00:04:58] [SPEAKER_00]: and others are going to have lower turnover rates.
[00:05:00] [SPEAKER_00]: I want to say it's lowest for the education world and technology, which is where we're
[00:05:07] [SPEAKER_00]: seeing layoffs happen.
[00:05:09] [SPEAKER_00]: I think because some of that expectation of what's available in the world is starting
[00:05:16] [SPEAKER_00]: to start into decline.
[00:05:19] [SPEAKER_03]: Yeah, and other industries where we feel like this is not, it's maybe a little weaker
[00:05:26] [SPEAKER_03]: or that the turnover's higher.
[00:05:28] [SPEAKER_00]: Yes, turnover is still higher than average if you're in the leisure and hospitality
[00:05:35] [SPEAKER_00]: world that's higher if you're in retail and customer service, it's higher if you're
[00:05:39] [SPEAKER_00]: in healthcare social assistance and it's higher if you're in construction.
[00:05:44] [SPEAKER_00]: So certainly you're going to have a year of mileage may vary when it comes to the type
[00:05:48] [SPEAKER_00]: of talent that you're trying to hold onto and what you have to do to hold on that talent
[00:05:53] [SPEAKER_00]: because some jobs are still very hot.
[00:05:55] [SPEAKER_03]: Interesting.
[00:05:56] [SPEAKER_03]: And Bill is our chief compensation on buzzman here.
[00:06:00] [SPEAKER_03]: Someone who's doing compensation possibly longer than anyone currently on this show
[00:06:04] [SPEAKER_03]: or listening to it.
[00:06:05] [SPEAKER_03]: Thanks, Russ.
[00:06:06] [SPEAKER_03]: No problem.
[00:06:06] [SPEAKER_03]: I got you back here, Bill.
[00:06:09] [SPEAKER_03]: Any insights in the movie?
[00:06:10] [SPEAKER_03]: Why those sort of traditional industries that always have high turnover or do you think maybe
[00:06:15] [SPEAKER_03]: there's something else going on here?
[00:06:17] [SPEAKER_02]: I think the answer is both and I apologize for the sound of my voice a little bit of
[00:06:23] [SPEAKER_02]: a scratchy throat here.
[00:06:25] [SPEAKER_02]: But I think like Amy just listed a handful of industries that are having the most turnover.
[00:06:30] [SPEAKER_02]: There are also industries that are having a lot of turmoil and pay.
[00:06:34] [SPEAKER_02]: Terminal that's positive for the employees, pay going up in healthcare in retail.
[00:06:43] [SPEAKER_02]: A lot at the lower end of the spectrum which is a little unusual.
[00:06:48] [SPEAKER_02]: I also think there's a lot of adjustments happening akin to right sizing if you will.
[00:06:56] [SPEAKER_02]: That's been going on in the last two years with employer's employers across all industries.
[00:07:03] [SPEAKER_02]: Having to struggle to react, increases and decreases in demands for their products and services.
[00:07:09] [SPEAKER_02]: Some overhired thinking that that new found demand during COVID was a new baseline when it
[00:07:15] [SPEAKER_02]: wasn't.
[00:07:17] [SPEAKER_02]: And while others were forced to cut staffs because demand floor just dropped out and then all of
[00:07:23] [SPEAKER_02]: sudden it came back.
[00:07:25] [SPEAKER_02]: So you've got people firing, hiring, hiring, hiring going on and now back to what state is
[00:07:33] [SPEAKER_02]: the economy in?
[00:07:35] [SPEAKER_02]: I had the same question, Amy.
[00:07:37] [SPEAKER_02]: We don't know what state it is but everybody's waiting to see what's going to happen.
[00:07:42] [SPEAKER_02]: All indicators point toward confusion in that history, like that there's the same history,
[00:07:51] [SPEAKER_02]: pizza itself, but it doesn't really repeat itself.
[00:07:53] [SPEAKER_02]: It echoes and it's unclear what the echo is doing now.
[00:07:58] [SPEAKER_02]: And even recently we've seen today the employment numbers or the new jobs numbers are out
[00:08:07] [SPEAKER_02]: in the Department of Labor's February jobs report and they're up higher than was expected.
[00:08:14] [SPEAKER_02]: Unemployment's gone up a little but new jobs have grown faster than was expected for February.
[00:08:20] [SPEAKER_02]: And what does that mean?
[00:08:22] [SPEAKER_02]: You know, in old school economics it means that we're headed toward a recession and we're not
[00:08:28] [SPEAKER_02]: headed toward a recession.
[00:08:30] [SPEAKER_02]: So you'd be the judge.
[00:08:34] [SPEAKER_02]: Can I have one more thought about the difference between involuntary and voluntary turnover
[00:08:41] [SPEAKER_02]: and that it's important to remember they're not totally independent.
[00:08:45] [SPEAKER_02]: So we talk about both issues but companies that lay people off will have typically lower
[00:08:56] [SPEAKER_02]: voluntary turnover because the company has taken action to get rid of people and some of those
[00:09:02] [SPEAKER_02]: people would likely have left on their own anyway.
[00:09:05] [SPEAKER_02]: That's how it works on a basic level but more complicated level.
[00:09:07] [SPEAKER_02]: There's a secondary effect if you, your organization,
[00:09:16] [SPEAKER_02]: executes involuntary, you know, turnover with larger layoffs, layoffs like to poor
[00:09:24] [SPEAKER_02]: communicated layoffs.
[00:09:27] [SPEAKER_02]: Just they may few ways you can do it.
[00:09:29] [SPEAKER_02]: That can result in what I would call follow on voluntary turnover where people are getting
[00:09:36] [SPEAKER_02]: frustrated and concerned about the employer, about the culture, about working there, about the future.
[00:09:44] [SPEAKER_02]: And so layoffs can trigger voluntary turnover.
[00:09:51] [SPEAKER_02]: And so it's you know they're not independent actions.
[00:09:55] [SPEAKER_02]: So it's just an important room.
[00:09:56] [SPEAKER_02]: Remember that and pay attention to what's going on in your organization.
[00:10:01] [SPEAKER_03]: I think that's a good insight.
[00:10:03] [SPEAKER_03]: Well Amy, do we kind of get into like maybe why some people are leaving?
[00:10:07] [SPEAKER_03]: Do we ask folks on their report on some of the best-bexers report? Why they leave?
[00:10:13] [SPEAKER_00]: We do ask what is most to blame for voluntary turnover from the perspective of the participants.
[00:10:20] [SPEAKER_00]: And we have a you know complex table in the report that has a lot of answer choices.
[00:10:26] [SPEAKER_00]: For that and we ask participants to rank them first second and third.
[00:10:31] [SPEAKER_00]: And the top ranked answer choice for first place is compensation.
[00:10:38] [SPEAKER_00]: You can kind of look at 2022 as the year of compensation in a way just so much happened around
[00:10:46] [SPEAKER_00]: wage increases inflation, paycheck and parent-e-lugization that it has been just a hot hot topic
[00:10:53] [SPEAKER_00]: in the last year. And I think that's going to continue into 2023.
[00:10:58] [SPEAKER_00]: Also high-end lists were things like limited advancement opportunities.
[00:11:02] [SPEAKER_00]: So you know are you promoting people of any organization? Do they feel there is a reason to stay
[00:11:07] [SPEAKER_00]: for those opportunities? And then the third and fourth choices were employee entitlement or kind of
[00:11:14] [SPEAKER_00]: grass as greener syndrome, which ties to that great resignation you know world that we've been
[00:11:21] [SPEAKER_00]: in for the past two years. And then also burnout due to being understaffed or overworked,
[00:11:26] [SPEAKER_00]: which ties to quite quitting which is also a topically covered in the report.
[00:11:32] [SPEAKER_03]: Interesting. Man, even now I'm still interested to see compensation is so high on the list.
[00:11:41] [SPEAKER_03]: Of course it's a comp folks that doesn't necessarily surprise us although
[00:11:45] [SPEAKER_03]: with the economy and its current state. That's sort of what I think that is.
[00:11:49] [SPEAKER_03]: It's sort of interesting. Ruth does it feel right to you that compensation is number one?
[00:11:53] [SPEAKER_01]: I think so for 2022 as Amy says, you know, I mean obviously we've always aware of any bias in our
[00:11:59] [SPEAKER_01]: surveys and you know as you mentioned Russ we do have a lot of comp pros I mean there are HRs
[00:12:04] [SPEAKER_01]: and business leaders who also take part in this study. So but the correlation is with some of
[00:12:10] [SPEAKER_01]: the other key surveys that we saw in the fall of 2022 that we've talked about on this podcast
[00:12:15] [SPEAKER_01]: before. So it's a study on employee sentiment by Mercer and then another similar study on why
[00:12:21] [SPEAKER_01]: people were leaving organizations done by McKinsey and they both had compensation and career
[00:12:28] [SPEAKER_01]: advancement as the top two reasons which correlate with this study. So I feel confident you know
[00:12:33] [SPEAKER_01]: in those answers and again not a surprise compensation against the backdrop of a cost of
[00:12:39] [SPEAKER_01]: living crisis. We know employees are laser focused on their compensation and they want increases
[00:12:46] [SPEAKER_01]: to match inflation and they're also concerned about paper questions so that's where I think
[00:12:51] [SPEAKER_01]: some of the career advancement comes in people want to know how they could increase their pay
[00:12:55] [SPEAKER_01]: and how they might do that by advancing their careers or getting a promotion.
[00:13:01] [SPEAKER_03]: Interesting and you mentioned a couple of things in there and one of them was sort of the
[00:13:07] [SPEAKER_03]: inflation crisis. So whatever the state is right definitely inflation is quite high and I know
[00:13:12] [SPEAKER_03]: every time we do a webinar with clients we always seem to get asked the question, you know how
[00:13:17] [SPEAKER_03]: do you see your clients responding to inflation and these sorts of changes and what are we doing
[00:13:24] [SPEAKER_03]: as a company or people to help our employees out in that space. Amy what you know is that
[00:13:30] [SPEAKER_03]: as moving to this sort of area what you know given all that going on what can employees expect
[00:13:34] [SPEAKER_03]: in terms of paying increases that's something that we're seeing is going up going down what's
[00:13:39] [SPEAKER_00]: the general mood? That is a fascinating question. I think top of mind for a lot of employers around
[00:13:47] [SPEAKER_00]: this time of year if not earlier in the year you know based on the economy how much are you
[00:13:54] [SPEAKER_00]: going to give or are you going to give anything? So what we're seeing in 2020-23 is that 80% of
[00:13:59] [SPEAKER_00]: organizations are planning to give pay increases of some kind but we have other 15% saying they
[00:14:06] [SPEAKER_00]: are a chore which means that up to 95% of organizations could be giving pay increases and on average
[00:14:13] [SPEAKER_00]: we are seeing that those increases are likely to be over that 3% base pay increase that
[00:14:19] [SPEAKER_00]: persisted for so long following the great recession. We're seeing 56% of organizations planning to
[00:14:24] [SPEAKER_00]: give more than 3% which is fewer than last year when 53% gave over 3% but much higher than previous
[00:14:34] [SPEAKER_00]: years when that number hovered around a third of organizations giving above 3%. So we expect pay increases
[00:14:41] [SPEAKER_00]: to be above 3% however we don't expect them to be higher than 5% which was more common last year
[00:14:49] [SPEAKER_03]: interesting. But what you take on that given the state of the state here
[00:14:55] [SPEAKER_03]: do you expect raises to be above 3% do you think that's right? I do think that's right there's a
[00:15:06] [SPEAKER_02]: push-pulled situation with employers looking forward to a potential recession or recession like
[00:15:12] [SPEAKER_02]: economy. You're looking at their business results and also looking at over their shoulders at
[00:15:19] [SPEAKER_02]: what their employees are finding vis-a-vis big increases by jumping to other employers. So
[00:15:28] [SPEAKER_02]: there's a lot of information coming into the employers that's not all telling them the same thing
[00:15:37] [SPEAKER_02]: and I think a lot of companies are trying to make sure that their their employee group is
[00:15:47] [SPEAKER_02]: somewhat stabilized and I think they will probably try to keep their raises. I mean basically
[00:15:55] [SPEAKER_02]: I'm going to repeat what Amy said in different words but they're going to try and keep their raises
[00:16:00] [SPEAKER_02]: high as they can, not as high as they were last year in general and perhaps as the year goes on
[00:16:11] [SPEAKER_02]: and things change if they change for the worse or the better they will probably use their
[00:16:18] [SPEAKER_02]: annual bonus plans or other variable plans to make up for the positive or negative difference.
[00:16:25] [SPEAKER_02]: And it's important to remember that this is on a industry specific or even a company specific
[00:16:34] [SPEAKER_02]: basis because you have to do what's right for your organization but you also have to keep in mind
[00:16:40] [SPEAKER_02]: what the people you're competing against are doing because if you say no salary increases
[00:16:46] [SPEAKER_02]: and all your competitors say you know four and a half percent you're going to start seeing
[00:16:51] [SPEAKER_02]: people live and leave quickly and it's going to be hard to stop it.
[00:16:56] [SPEAKER_03]: Yeah, especially with the number one reason being compensation there.
[00:17:00] [SPEAKER_03]: Ruth what's your does that feel right to you also? Are you surprised by the three percent?
[00:17:05] [SPEAKER_01]: No I would expect it to be you know higher I think you know seeing that number of
[00:17:10] [SPEAKER_01]: organizations that plan to give you know five percent increases. I think companies are still
[00:17:15] [SPEAKER_01]: paying catch up those that didn't make significant adjustments through 22 have got work to
[00:17:22] [SPEAKER_01]: do going into 23 but I think the only point I'd make here is the day of like one magic number
[00:17:29] [SPEAKER_01]: serving us at all as we set compensation budgets I think has gone and this is very
[00:17:34] [SPEAKER_01]: bit sector specific and even you know geospycific and so you do need to you know kind of do
[00:17:41] [SPEAKER_01]: research to look at what's impacting your specific talent markets to understand what that number should be.
[00:17:48] [SPEAKER_03]: Yeah I kind of wonder I remember we were doing back before COVID in the before times we used to do
[00:17:55] [SPEAKER_03]: those webinars like weaponizing compensation right and and this is back when like target
[00:18:01] [SPEAKER_03]: others would or am as I would come into a space and a sector and just say 15 bucks an hour
[00:18:06] [SPEAKER_03]: I think even call centers of bank America on 20 bucks an hour and just really using it as a way to
[00:18:11] [SPEAKER_03]: recruit in times where it's hard to find people and I kind of wonder if we've started to move back
[00:18:16] [SPEAKER_03]: to a time when people are starting to really get very tactical about their compensation and thinking
[00:18:20] [SPEAKER_03]: more in that manner instead of just hope is everybody doing three okay we'll do three we kind of
[00:18:25] [SPEAKER_03]: that we're all sort of working together to encourage now we're kind of coming out of that and we're
[00:18:28] [SPEAKER_01]: sort of back to competing against each other a little bit. Yeah we've seen practice of employers particularly
[00:18:33] [SPEAKER_01]: those that have high numbers of lower wage workers you know who have focused increases on
[00:18:39] [SPEAKER_01]: those workers or they've done specific one-off payments to counteract the cost of living crisis so
[00:18:45] [SPEAKER_01]: it is definitely mixed bag in terms of how people are approaching this. So any thinking about that
[00:18:51] [SPEAKER_03]: if we're trying to understand if we you know taking what Ruth and Bill both said there would the idea
[00:18:57] [SPEAKER_03]: that hey you know companies it's not as standard as it used to be even by industry and geography
[00:19:03] [SPEAKER_03]: maybe people are doing a little different things it seems like it's more important ever to really
[00:19:07] [SPEAKER_03]: get good market data and really understand what folks are doing so you can avoid the situation
[00:19:11] [SPEAKER_03]: Bill just said if you decide you you don't want to do an increase this year how bad that
[00:19:16] [SPEAKER_03]: got to be compared to your your neighbors or competitors in your same market what are we seeing
[00:19:21] [SPEAKER_03]: for trends around how people are thinking about getting their market data.
[00:19:26] [SPEAKER_00]: Yeah that's a really interesting question um before I dig into that I think it's important to
[00:19:31] [SPEAKER_00]: note that really you have to focus on pay communications around this so yes you should absolutely
[00:19:38] [SPEAKER_00]: be digging into distinct sources of data and our report does show that most organizations use
[00:19:45] [SPEAKER_00]: between two and four data sources when they are looking to inform market pricing for salaries.
[00:19:50] [SPEAKER_00]: That's the expected I mean an admin and mum used to have three sources that you can try
[00:19:55] [SPEAKER_00]: and you like pricing and make sure that you are setting salaries at market rates that are fair
[00:20:02] [SPEAKER_00]: but really it's important to make sure you were explaining why it is fair to your employees and
[00:20:08] [SPEAKER_00]: uh I don't know if we're going to go into pay communications as in depth in this particular session
[00:20:13] [SPEAKER_00]: as we might otherwise but there's a whole section on that in the report and I think it's important to
[00:20:19] [SPEAKER_00]: you know not just have multiple sources of data but to explain to your employees how you determine
[00:20:26] [SPEAKER_00]: what both their pay is and what their pay increases are because you could be doing everything right
[00:20:31] [SPEAKER_00]: but to the employee they may just see you know a you know a peer of mine said that they got X
[00:20:37] [SPEAKER_00]: and I didn't so it's not fair um and I think that that's uh something gets overlooked a lot
[00:20:44] [SPEAKER_00]: by a lot of organizations the importance of that communication um it's also you know it's
[00:20:50] [SPEAKER_00]: something to think about is that um the use of more than five sources in a lot of organizations
[00:20:57] [SPEAKER_00]: if you have like uh you know a lot of different industry roles if you need if you need
[00:21:03] [SPEAKER_00]: niche data for particular types of um of jobs that you are setting pay for it can be common to use
[00:21:11] [SPEAKER_00]: more than 20 sources um and top performing organizations do that interesting uh and you know
[00:21:18] [SPEAKER_03]: do you have any insights into uh the kind of sources or do we see any movement in the kinds of
[00:21:23] [SPEAKER_00]: data people trust more yeah there's a whole breakdown of that in the compensation best practices
[00:21:30] [SPEAKER_00]: report um we have a you know again a complex table that shows all the different types of data
[00:21:36] [SPEAKER_00]: that you can get so um if you're a comp probably from familiar with traditional surveys um the
[00:21:41] [SPEAKER_00]: most popular data source is free or open line data that's uh you know you're gonna google it
[00:21:46] [SPEAKER_00]: you're gonna go look at what people are posting for free on online and 50% of organizations
[00:21:51] [SPEAKER_00]: instead that they do that um but what's important to note is that when it comes to uh salarita
[00:21:57] [SPEAKER_00]: that you trust that drops through the very bottom um and what is at the very top for trusted data
[00:22:03] [SPEAKER_00]: as a data that has been um that it against um various indicators to make sure that it is
[00:22:10] [SPEAKER_00]: accurate and usable um our you know salarita survey data from traditional public publishers
[00:22:15] [SPEAKER_00]: H.R. reported aggregated market data but you get from uh being a subscription member of
[00:22:22] [SPEAKER_00]: compensation software like we have here at pay scale um and uh you know even uh resources like like
[00:22:31] [SPEAKER_00]: here that we have um uh here at pay scale also which in our surveys as described as a
[00:22:38] [SPEAKER_00]: a closed network HR reported salarita source because we're trying to make it generic um to
[00:22:46] [SPEAKER_00]: encapsulate where else you might find data like that but but we we see an increase in the number
[00:22:51] [SPEAKER_00]: of organizations that are using new and different types of data sources um when it comes to setting
[00:22:57] [SPEAKER_03]: uh well it's great to see people looking at the different options um but it's interesting to
[00:23:02] [SPEAKER_03]: me too that there's such a big drop mean literally just like the percentages here in your in the
[00:23:06] [SPEAKER_03]: charts uh you mean you 50% of people are looking at or using online data a free data in some way
[00:23:13] [SPEAKER_03]: but then literally only 5% use it as first tier only 10 less than 10% use it as second tier
[00:23:18] [SPEAKER_03]: uh that's just quite like just just a position there build what's your reaction that that's
[00:23:23] [SPEAKER_03]: prize you at all that that kind of duck uh dichotomy? It actually does not surprise me you know it
[00:23:30] [SPEAKER_02]: makes sense is uh when you're looking for information in general on any topic that doesn't have
[00:23:38] [SPEAKER_02]: to be compensation or each are related you know you automatically think where can I get the best
[00:23:45] [SPEAKER_02]: answer where can I get what I think is going to most quickly get me information I need and can rely
[00:23:52] [SPEAKER_02]: on and you know we've all been trained to go to you know big name sources you know you go to
[00:24:01] [SPEAKER_02]: webster's dictionary you go to the New York Times you go to the Wall Street Journal you go to
[00:24:06] [SPEAKER_02]: you know you you know you have this list in your head and the traditional survey publishers have been
[00:24:12] [SPEAKER_02]: doing this this function providing this function providing these reports for you know 50 75 years
[00:24:22] [SPEAKER_02]: and everyone has relied on them at some level for that whole period of time it's safe you know it's
[00:24:30] [SPEAKER_02]: like the old you know the old adage nobody got fired for hiring IBM you know you can't you know
[00:24:37] [SPEAKER_02]: you can't go wrong with that and so uh for companies that use those sources that would you know
[00:24:43] [SPEAKER_02]: and be their first choice but what's interesting to me is that although like as I pointed out
[00:24:53] [SPEAKER_02]: that the free and open online data source drops to the bottom of the trust level it still shows up
[00:25:01] [SPEAKER_02]: in the top three of like it's included in in the top three tiers of data sources
[00:25:11] [SPEAKER_02]: for more people than anything else you know which tells me you know yes it's a economy but it's also
[00:25:19] [SPEAKER_02]: I know I can always get an answer and you know one thing I always say is like finding any answer is a
[00:25:25] [SPEAKER_02]: good starting point having no answer is you know you're stuck having to make something up so if
[00:25:30] [SPEAKER_02]: you have an answer you can at least look at that and try and figure out how to adjust it or like
[00:25:35] [SPEAKER_02]: how to use it you know regardless of how much facing put in the individual publisher of that data
[00:25:44] [SPEAKER_02]: so I think people are being smart and judicious about how they're picking their sources
[00:25:50] [SPEAKER_03]: and when and how they're using them yeah I think that's right Ruth what's your reaction to
[00:25:57] [SPEAKER_01]: some of this data here around the data source usage but it's interesting because we have done a
[00:26:02] [SPEAKER_01]: repeal in cut of this report for the first time this year and we haven't we and I've just been
[00:26:07] [SPEAKER_01]: looking at some of that data because we're doing an event next week on that and in Europe
[00:26:12] [SPEAKER_01]: the free or open online data is not as popular so the salary in its traditional salary surveys are
[00:26:21] [SPEAKER_01]: more popular here in Europe and so I don't think we have that same kind of like access maybe
[00:26:27] [SPEAKER_01]: to as many free or open sources of data but I thought that was an interesting observation when
[00:26:31] [SPEAKER_03]: it was looking at the European cut of data. Well that is really interesting yeah I had to think about this
[00:26:39] [SPEAKER_03]: more but I I kind of like where you're going but I I wonder if I'm really curious about the year
[00:26:46] [SPEAKER_03]: of thing too I wanted to have to do some of the privacy rules there but what's really interesting
[00:26:50] [SPEAKER_03]: to me is if it's one of your if the free date is one of your cuts and using it as your third cut
[00:26:56] [SPEAKER_03]: it kind of know especially when you're doing with interview candidates there only sources
[00:27:01] [SPEAKER_03]: probably that open free stuff so being able to compare that to what you're using for your structures
[00:27:06] [SPEAKER_03]: let's say if you're using one of the top tier items at least you kind of know what the employees
[00:27:10] [SPEAKER_03]: thinking which is sort of interesting. Interesting so another hot topic obviously let's get away from
[00:27:19] [SPEAKER_03]: from data for a minute get back to the thing to sort of on everybody's mind after you get past the
[00:27:23] [SPEAKER_03]: economy is a pay transparency. Amy do we see is it I mean it seems like it's hot all these
[00:27:32] [SPEAKER_03]: states are passing laws about putting job ranges on job descriptions or job postings what
[00:27:38] [SPEAKER_03]: would we see in our in our report regarding pay transparency? It's definitely hot in the news and
[00:27:44] [SPEAKER_00]: I think that pay transparency is going to gain traction over time to that to the extent that I
[00:27:53] [SPEAKER_00]: say your job applicants are going to expect it and you're going to get more applications and
[00:27:59] [SPEAKER_00]: higher quality ones if you are posting the pay range in jobs because other competitors are
[00:28:07] [SPEAKER_00]: going to be doing that and those jobs are going to be more attractive if the employee can see
[00:28:11] [SPEAKER_00]: for short but the whole interview process is worth their time and we are seeing that organizations
[00:28:17] [SPEAKER_00]: are adopting this at faster rate so a minority of organizations 45% tell us
[00:28:23] [SPEAKER_00]: they include pay ranges in job postings at present but that is up from double last year when only
[00:28:30] [SPEAKER_00]: 22% of organizations added pay ranges to job postings and there is a split in the report that
[00:28:36] [SPEAKER_00]: shows why they do it like whether they're doing it because it's required by a law which is 27%
[00:28:42] [SPEAKER_00]: or they do it regardless of whether it's required by law so that one's that one's that do it
[00:28:49] [SPEAKER_00]: because it requires 18% that total 45% number of those things added together is twice what
[00:28:55] [SPEAKER_00]: it was last year which I think is the really the most interesting point. Pay transparency is likely
[00:29:02] [SPEAKER_00]: to spread in terms of legislation in 2023. The reason for this legislation is, you know it's
[00:29:10] [SPEAKER_00]: multi-prong but one of the things that we know that pay transparency does is it close the gender
[00:29:16] [SPEAKER_00]: and that's high on my list of priorities right now because we are publishing our gender
[00:29:21] [SPEAKER_00]: pay gap report next week and it's exciting to see that the gender pay gap is starting to close
[00:29:28] [SPEAKER_00]: in certain sectors and so I don't know if this page transparency legislation is quite having
[00:29:34] [SPEAKER_00]: a direct impact on that yet but if it's not now I think it will over time and that is really
[00:29:40] [SPEAKER_00]: exciting from a diversity equity inclusion and belonging perspective if that's not something
[00:29:45] [SPEAKER_00]: important to your organization it probably should be and you know there's a whole section on
[00:29:49] [SPEAKER_00]: pay equity and compensation best practices report and why pay equity is something that you should
[00:29:54] [SPEAKER_00]: be investing in in order to become more transparent is really kind of a requirement because you don't
[00:30:00] [SPEAKER_00]: want candidates to have that experience of looking at free online salary data and then comparing
[00:30:06] [SPEAKER_00]: that with what you are offering and having a negative reaction so you really have to have all
[00:30:12] [SPEAKER_00]: your ducks in a row when it comes to how you are pricing jobs and how you are communicating
[00:30:17] [SPEAKER_03]: the pricing of those jobs to applicants yeah I think that's well it's exciting to hear some
[00:30:22] [SPEAKER_03]: of that good news I know we still gotta keep watching things but that's that's great and
[00:30:26] [SPEAKER_03]: and I like your insight and your comment there about you know pay transparency and pay equity
[00:30:31] [SPEAKER_03]: or link right you can't really have pay transparency without having pay equity and you can't really
[00:30:35] [SPEAKER_03]: show your equitable if you're also not transparent so these things are really join us so we do a
[00:30:40] [SPEAKER_03]: lot of work with clients on making sure you know they understand that those those challenges
[00:30:45] [SPEAKER_03]: and maybe make have the right tools to do that and then a Ruth you've been doing a lot of
[00:30:49] [SPEAKER_03]: work with our clients on those pay transparency solutions how do these trends just that we're
[00:30:54] [SPEAKER_03]: seeing in the report sort of aligned to some of the things you're seeing as you work with clients
[00:30:58] [SPEAKER_01]: well interestingly you know we've seen a significant uptick in terms of organizations that are
[00:31:05] [SPEAKER_01]: looking to improve their compensation practices and so if you think about it pay ranges kind of
[00:31:11] [SPEAKER_01]: historically are very much been used for internal administration but now they're having to be
[00:31:17] [SPEAKER_01]: externally facing now we're having to put them on job ads now we're having talk to employees
[00:31:22] [SPEAKER_01]: about them I think you know most of us are discovering that there's some work to do in terms
[00:31:26] [SPEAKER_01]: of improving those practices and so we did see in the study 40% of organizations are saying
[00:31:32] [SPEAKER_01]: page transparency legislation is forcing them to drive change and improve their
[00:31:37] [SPEAKER_01]: compressors and interestingly when we we also saw that organizations when asked about the
[00:31:45] [SPEAKER_01]: main reason that was stopping them from progressing their pay transparency not having
[00:31:50] [SPEAKER_01]: a structures in place was the main reason so that's where we're seeing a lot of activity
[00:31:54] [SPEAKER_01]: in terms of you know clients coming to us and saying please help us with our compensation structures
[00:31:59] [SPEAKER_01]: Amy you mentioned communication earlier I still find it well we did see the uptick in terms of
[00:32:06] [SPEAKER_01]: companies that were training managers on pay communications that's 49% this year up from 36% last
[00:32:13] [SPEAKER_01]: year Amy I think so you know I think people are starting to embrace the fact that managers you know
[00:32:20] [SPEAKER_01]: are your agents for change here in this transparency journey and they need to be able to understand
[00:32:25] [SPEAKER_01]: things like your pay philosophy one of the things that you're trying to pay for in the
[00:32:29] [SPEAKER_01]: organization and pay structures because employees increasingly are feeling empowered to ask those
[00:32:35] [SPEAKER_01]: questions and I think we all have to understand that you know to tackle pay transparency this doesn't
[00:32:41] [SPEAKER_01]: just stop at the door at the Compton Department we all have to across an organization work together
[00:32:47] [SPEAKER_01]: to get to get to that point of being able to share information across the organization
[00:32:54] [SPEAKER_03]: and I think that's right it doesn't surprise me there about the salary structures I don't know
[00:32:58] [SPEAKER_03]: that's a lot of people very passionate about those including our product team here but Bill I wanted to ask you
[00:33:05] [SPEAKER_03]: you know again you've been doing this a long time you've been seeing these companies on a
[00:33:09] [SPEAKER_03]: quest for pay equity and pay transparency for a long time do you get that sense as Amy shared
[00:33:16] [SPEAKER_03]: that maybe we're starting to turn the corner here and how to some of these things how to
[00:33:20] [SPEAKER_02]: what you're reacting to some of these trends well thanks for asking me that question
[00:33:26] [SPEAKER_02]: and I'm going to Amy prepare to have your mind to go on because when you were talking and
[00:33:32] [SPEAKER_02]: breath out and on it was like wait this all comes together in a bizarre way so I've been hearing
[00:33:39] [SPEAKER_02]: about you know pay transparency D.E.I diversity gender pay gap for you know my entire career
[00:33:50] [SPEAKER_02]: and you know if you look at old workspan magazines for more of that work back in the 80s
[00:33:56] [SPEAKER_02]: they were talking about these issues but Amy used two phrases one as she started talking about this
[00:34:04] [SPEAKER_02]: topic and one way at the beginning of the podcast which said you know it's hot in the news
[00:34:10] [SPEAKER_02]: talking about pay transparency high or salary increases D.E.I gender pay gap and then there's this
[00:34:17] [SPEAKER_02]: power struggle between employers and employees and what's happened I think is that it's not
[00:34:24] [SPEAKER_02]: HR talking to HR about what HR should do it's the entire world talking about what's the right thing
[00:34:31] [SPEAKER_02]: to do and so the fact that this is all in the news is now giving our HR appears
[00:34:41] [SPEAKER_02]: enough influence with employers and you know employer groups etc to be able to actually have
[00:34:49] [SPEAKER_02]: influence and say no we do have to do this it's not you know just HR being whiny and trying to
[00:34:56] [SPEAKER_02]: like get something done it's there's a lot of pressure coming from you know outside the HR
[00:35:02] [SPEAKER_02]: groups saying yes we do need to fix these problems we do need to do this and I think that that's
[00:35:09] [SPEAKER_02]: huge part of it and so it's got enough weight behind it now that companies have to communicate
[00:35:16] [SPEAKER_02]: better they have to fix these you know gender pay problem is these pay equity problems these
[00:35:22] [SPEAKER_02]: diversity problems inclusion problems etc and yeah it's not going to be perfect and it's not
[00:35:28] [SPEAKER_02]: going to be fast but I think you know we're definitely seeing a huge increase in the rate at
[00:35:34] [SPEAKER_02]: things are changing and being adopted and we'll continue seeing that I mean I think it's really
[00:35:40] [SPEAKER_00]: exciting and it's not just like newspapers it's all of social media so at any point in time you
[00:35:47] [SPEAKER_00]: can go into you know LinkedIn, Twitter, Reddit forum or some other forum and find people talking
[00:35:54] [SPEAKER_00]: about their salaries but find them talking about pay equity and why you know they believe it is
[00:36:00] [SPEAKER_00]: not something that their organization cares about and you find a lot of misinformation as well
[00:36:07] [SPEAKER_00]: from employees not your standing how how their pay is determined I think one of the most common ones
[00:36:12] [SPEAKER_00]: is you know people starting to see pay ranges posted to job ads and saying hey I don't make the
[00:36:20] [SPEAKER_00]: top of this range but unfair right so like one one big communication point that I think every
[00:36:26] [SPEAKER_00]: organization should be investing in and explaining how people fall along ranges to their employees like
[00:36:34] [SPEAKER_00]: what is the methodology for that practice because there is just a lot of misunderstanding you
[00:36:39] [SPEAKER_00]: the average person is going to see a pay range and they're going to want the biggest number
[00:36:43] [SPEAKER_00]: on that pay range it's a natural human instinct but there is you know a mathematical methodology
[00:36:49] [SPEAKER_00]: for how pay ranges are determined and how people are slaughtered along those ranges but if you don't
[00:36:54] [SPEAKER_00]: explain that to your job candidates and current employees they're going to be satisfied
[00:36:59] [SPEAKER_00]: looking at those numbers and making their own assumptions so I think there's a lot of work to do
[00:37:03] [SPEAKER_00]: from a communications standpoint but the conversation is really exciting because if we are moving towards
[00:37:08] [SPEAKER_02]: pay equity and I think that's what we want to be. Can I double down on that like the number of times
[00:37:14] [SPEAKER_02]: I've heard people you know low level and high level people say things like you know the median
[00:37:21] [SPEAKER_02]: salary for this job that you're telling us is wrong you know half the people in our organization
[00:37:27] [SPEAKER_02]: in that job are paid less than that right and it comes back to what both Ruth and Amy
[00:37:37] [SPEAKER_02]: and you know I've said in the past Ruth and Amy said it today is it's you got to train
[00:37:43] [SPEAKER_02]: like you basically everybody but start with your managers to understand how to communicate
[00:37:48] [SPEAKER_02]: this stuff and how to make sure people understand what it means and understand what it doesn't
[00:37:53] [SPEAKER_02]: mean because that's your best defense against the social media rants which if you as an employer don't
[00:38:01] [SPEAKER_02]: take control of the conversation around your employees they're going to seek that information
[00:38:07] [SPEAKER_02]: at the best available source and if it's not my manager it's going to be reddit or tick talk or whatever
[00:38:15] [SPEAKER_02]: and then you know they get all worked up over bad information so give them good information that
[00:38:22] [SPEAKER_02]: you can stand behind and that will help not everybody let's be realistic but most people will
[00:38:31] [SPEAKER_02]: understand there is a process there is rationality and this is acceptable. Yeah great insights
[00:38:39] [SPEAKER_03]: Belle Ruth anything you want to leave us with here before we wrap up? Well other than you know
[00:38:45] [SPEAKER_01]: please do go and download the report it's on the front page still I think of our website
[00:38:50] [SPEAKER_01]: so if you want to dig into that data you know we find people like to use it for building
[00:38:55] [SPEAKER_01]: business cases potentially you know for work but they want to get done in terms of their
[00:38:59] [SPEAKER_01]: comp strategy and comp structures it's really just a mine of information so just congratulate
[00:39:05] [SPEAKER_01]: you Amy on another amazing report this year. Thank you so much Ruth as you mentioned it is on
[00:39:11] [SPEAKER_00]: website there's a banner at the top of the homepage on piscobaccomb that will take you directly
[00:39:16] [SPEAKER_00]: to the report or you can click through the research insights tab and it is pinned
[00:39:21] [SPEAKER_03]: to the top of that section as well. Awesome all you think you're so much for joining us
[00:39:26] [SPEAKER_03]: and taking the time out of your busy schedule especially right now and you get ready to
[00:39:30] [SPEAKER_03]: you know it's unlaunched in your following up with activities so thank you for another amazing
[00:39:34] [SPEAKER_03]: report this year and Bill thank you for joining us the Spite Your Gravely Boys
[00:39:41] [SPEAKER_02]: but I had one can I add one quick point yeah reiterate what Ruth and Amy were saying
[00:39:47] [SPEAKER_02]: is yeah download it and save it on your desktop and just think every time somebody comes into
[00:39:53] [SPEAKER_02]: your office and ask you a question about what other companies do what's normal you know this is
[00:40:01] [SPEAKER_02]: hundreds of statistics that will answer at least the first level answer that question
[00:40:07] [SPEAKER_02]: you know and just having it at your ready flip through it so you know what's in it so
[00:40:11] [SPEAKER_02]: that you can you know leverage it make yourself look better to the people you're with
[00:40:18] [SPEAKER_03]: Michelle right maybe maybe also talk to them when you have a gravely voice too could you
[00:40:23] [SPEAKER_03]: sound wiser and maybe more experienced so just run it out there. Bye thank you
[00:40:29] [SPEAKER_03]: so thanks again Amy thanks Bill and thank you Ruth for joining us um when you do down
[00:40:34] [SPEAKER_03]: though download the report and take a look at it and read through it um you've heard what we think
[00:40:38] [SPEAKER_03]: but please let us know what you think what what where your reactions you can do that by either
[00:40:43] [SPEAKER_03]: emailing us at coffee at payscale.com or by reaching out to us at payscale on Twitter thanks for
[00:40:49] [SPEAKER_03]: listening to comp and coffee. Comp and coffee is a payscale production dedicated to the compensation
[00:41:07] [SPEAKER_03]: community we welcome your feedback send email to coffee at payscale.com
[00:41:13] [SPEAKER_03]: tweet us at payscale or share your thoughts in our payscale connect community
[00:41:18] [SPEAKER_03]: until next time keep your coffee hot and your data fresh
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