As life shows, the finding-a-job language cannot always be direct. Frequently when looking at job ads, we can see such a phrase as “competitive pay." If you’re reading our post now, it means you’re interested to know what it signifies.
Competitive pay can serve as a great method to engage the high-class specialists and keep them working in the companies. That’s why like a job seeker, you need to learn to define and measure the things that affect salary competitiveness. This ability will help a lot in the job searching, application process, and interviews.
First of all, let’s figure out what competitive wage signifies. It is a compensation rated at the market rates (higher or equal rates) for a concrete post of the concrete sphere and geographic spot.
As for the adjective “competitive," here, it means the situation when some organization attracts high-class specialists by using their wages. In some cases, it can mean the situation when the company management wishes to discuss the pay to block the top candidates for the position.
For HR departments, a competitive salary is suggesting the pay within +/-10 percent of the middle rate. But in reality, it means something more than the basic wage (the lowest amount of money without any rewards and other payments).
Competitive salary also comprises the competitive package of benefits. The competitiveness of this package depends on such things as health insurance, paid vacations, opportunities for professional growth, flexible work hours, etc.
There are small organizations that cannot compete with bigger firms in terms of the basic wage. But instead, they can have great packages of benefits. What do we want to say? We want to say that the numbers cannot tell you the whole thing, that’s why you need to know everything that affects the salary’s competitiveness.
What does competitive wage signify for us as job seekers?
According to the rates on the market, the sense of the phrase “competitive salary” varies. In its turn, the market rates depend on the following aspects:
- Position. The first thing you should do is to study the pay range for the position you want to apply for. Here, you can use various sources to know the average salary range for your post. If you see that the wage corresponds to the average salary range or surpasses it, be sure that this is a competitive salary.
- Sphere. There is one great strategy you can use to get a great wage – you can submit applications for identical vacancies in various spheres. Here, you’ll have to do great research to know how every position is rated in various spheres.
- Placement. All American states have varying competitive wages. In Washington, the competitive salary is higher compared to the rural areas. It’ll be easier for you to define the salary’s competitiveness in different states in case you do deep research.
- Accessibility. There’s one law that has its power in all spheres of life - the less frequent and demanded things are more precious compared to those that are widespread and less wanted. This law is also applied to the job sphere. You’ll have a more competitive salary in case you’re a specialist with hard-to-find highly tailored abilities. And in contrast, the specialist with the basic abilities will get the competitive wage of not the high level.
There’s one important thing – job accessibility depends on the placement. So if you have succeeded to know the time the organization has been spending to find the worker and the number of people that apply for the position, you’ll have a clear vision of demand and supply for this post.
- Ability rate. The competitive pay level directly depends on the ability rate. The applicants with top ability level will get higher salaries compared to the starting-level applicants. When looking for wage information, you should always consider your ability level. It’ll give you a better vision of what salary you’ll get.
The competitive package of benefits components
As a rule, the competitive package of benefits should consist of the following:
- Health insurance paid by the company’s administration. For the great part of American workers, health insurance means a lot in employment. Private health insurance is very expensive (even if not more), that’s why having the paid health insurance is great luck.
- Holidays with pay. For the workers, it’s important to have a possibility to take a vacation and spend this time for themselves. The situation when the workers don’t need to worry about money because they want to take leave means a big step in improving the workers’ life quality. In the USA, there are organizations that suggest the policy of limitless holidays. It’s a great thing but there’s one disadvantage – no payment for unused holidays. According to research, the average American gets approximately eight days of personal time off every year. It means that suggesting over eight days of personal time off will bring more competitiveness for the great part of vacancies.
- Plan of pension. It can be rather challenging to save up money for a pension but thanks to the companies’ programs aimed to decrease the pre-tax revenues, you can do it much easier. The popular pension plans include Roth IRA, 401 (k), etc.
The other things that can be added to the competitive package of benefits are the following – insurance of life, the organization’s car use, flexible work hours, variants of remote job, etc.
The good salary – how to get it?
The wage discussion always causes stress; that’s why here, you need to be brave and defend your interests. You should persuade the employers that you’re a valued worker. Bear in mind that not only your starting pay is at stake here. It only defines your income trajectory during your entire career path; that’s why you should be serious about it.
- Determine your aims. In any discussion, you need to define the things you want to get from the package of benefits. It signifies you need to choose the things you care about the most – get a high salary, have good health insurance, or a good-paid vacation. For every person, non-monetary benefits have different meanings, that’s why before the research, think about the things that are really important for you. Besides, you should do research and take into account the money you’ll have to pay for the health insurance and pension savings in case the management won’t give you the corresponding programs.
- Know your self-worth. Do you remember all the information you get from your research? Now, it’s time to utilize it. When you know what the middle-wage is for the applicant in your case, you’ll have a vision of what the competitive pay should be. And besides it, you should also think about your self-worth. Here, you should remember all your victories and how they have affected your self-worth. It stops you from underestimating the wage demands, plus gives confidence during salary discussion.
- Be strong in any situation. All of us have wishes and demands. And when going for the interview, you should have the arguments why the organization must respond to them. Like you, the management can freely get the information about the salary. That’s why you need to demonstrate to them that you’ve studied this question and you’re not silly to consider the lowest wage level as truly competitive. When discussing the salary, you should apply your information to present your position, be prepared to split the differences, or be rejected. Before the discussion, we recommend also thinking about the point where you can make a compromise and seeing whether the organization satisfies the minimum demands. Besides, take into account the promotion opportunity.
- Move with the times. Even if you’ve succeeded in getting the competitive wage, it doesn’t mean the end. Now you know that there are aspects that change during your entire career. That’s why you should constantly measure the competitive wage level to get what you truly deserve.
Why is it important to suggest a competitive salary?
Competitive pay means a lot for those employers who want to have high-class specialists. And it’s not all that the competitive wage can do. It can also simplify the recruiting process, reduce staff turnover, strengthen performance and staff morale, plus make a strong corporate culture.
Like we’ve advised earlier, the workers should constantly measure the competitive wage level. The employers should also do the same. They should always make changes to their competitive salary to keep up with the market and meet the workers’ demands.
In general, the management should consider their workers as treasures. Thanks to competitive pay, there’s a guarantee that these investments in workers will pay off in time. Besides, if other companies try to steal your specialists, they’ll fail to do as you pay them the competitive salary now.
To sum up
If you want to have a fair salary, the first thing you should do is to know what competitive pay signifies. It does not matter what the situation is (you want to earn a higher salary or you’re going to discuss your wage with management) you should always be ready to prove your value as a specialist.
Before asking for a higher wage, you should remember that there are other elements of the package of benefits that you also need to discuss.
There’s nothing wrong with a higher salary, but before saying “no” to an offering that doesn’t satisfy your demands, you should think about the things that the package of benefits includes.