With the unemployment rate at a near-historic low – the lowest it has been since 1969 – businesses large and small are having to work harder and smarter to find more innovative ways to stand out from the competition in terms of recruitment; enterprise organizations in particular are feeling the pressure to attract and retain talent.
In 2017, PayScale conducted a survey of 7,000+ organizations to learn more about their compensation strategies and practices. More than 500 of those respondents were from enterprise organizations (organizations with 5,000+ employees).
Are you curious about how other organizations approach their compensation strategies? Are you concerned about compensation in your workplace? You’re certainly not alone. We found that across the board, a majority of organizations (57 percent) agreed that compensation is becoming a critical issue.
Facing even tighter competition for business and talent, 67 percent of enterprise organizations agree that comp is becoming more important to their executives – an increase of 3 percentage points over the previous year. Offering competitive pay continues to be an effective approach for senior leaders to retain and attract talent in today’s tight market.
Here are some additional highlights from the Enterprise Edition of the 2018 Compensation Best Practices Report:
In the past, companies typically had the luxury of waiting three-to-five years before updating their pay structure. However, markets are moving swiftly, and companies can no longer wait as long to ensure their pay structures are up to date. A vast majority (82 percent) of enterprise organizations have updated their pay ranges in the past two years; 59 percent have done so in the last year.
Recognition and Rewards
Larger companies are more likely to reward top performers with bigger base pay increases (64 percent versus 54 percent overall). However, money is just one component of a larger strategy. Award or recognition programs (like employee of the month) are the second-most-popular way to recognize top performers (39 percent), followed by informal bonuses or incentives (32 percent).
Communication and Training
The way companies communicate compensation is essentially as important as the compensation itself. Enterprise organizations are more likely to say they have transparent pay practices. Total compensation statements are a great way for companies to proactively manage their pay brand. Enterprise organizations are more likely than smaller organizations to provide total compensation statements (42 percent of enterprise versus 36 percent of all). Giving employees access to data is just one part of a larger compensation communication plan.
Want to learn more? Download the 2018 Compensation Best Practices Report: Enterprise Edition.