Should salary be disclosed in a job advertisement?
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This billion-dollar question is a difficult one to answer because of the varying perspectives and motives of candidates and recruiters.
It’s wild to think employment must be mutually beneficial for the company and the employee, but for years both parties have struggled to find common ground in regards to disclosing salary.
I know you have your own opinion, but the aim of this blog is to help you see this ongoing debate from an alternate perspective. To achieve this, I’m going to analyse the for and against arguments of disclosing the salary in a job advertisement… from both the candidate and recruiter perspective.
After outlining both perspectives, there will be a quick summary, followed by a few exclusive recommendations.
Let’s dive in!
Argument #1: Bills to pay.
Sometimes employers forget that candidates are professionals who have personal lives, families, and bills to pay.
Every candidate will have a different perspective on the ideal salary for them based on their lifestyle. At the bare minimum, candidates need to ensure their new job enables them to comfortably live their lifestyle, and pay their bills.
From the candidate’s perspective, there’s no point in applying for a position when it would be unsustainable and doesn’t pay their bills. It’s as simple as that.
Argument #2: ‘Employers can be picky so why can’t I?’.
Sometimes it feels like employers hold all the cards… they call when it suits them, they get to pick their desired experience and skills, they decide whether or not I progress… The least they could do is disclose a salary range, right?!
Employers are picky in order to certify they chose the most suitable candidate that offers the most value and promises candidate retention. Well, let’s spin this.
Candidates want to be just as selective. They want to ensure the company they join acknowledges their skills, values their contribution, and compensates them.
It’s sad to say, but money makes the world go round. Salary may not be the end-all, but it is a key factor in decision making. Businesses operating in the retail industry always disclose prices, which is pivotal in influencing the decision of consumers, thus why should recruitment be any different?
Argument #3: Don’t want to waste time.
Ladies and gentlemen, time is precious! As the saying goes, ‘time is money’, so why waste it? From the perspective of a candidate, there’s no time to waste applying to jobs that don’t meet their basic needs. This will differ from candidate to candidate, such as; location, work flexibility, benefits, and…bingo… salary!
If the salary isn’t disclosed, candidates spend time applying to jobs and partaking in interviews, to later discover it doesn’t meet their critical requirements. Not only does this waste the time of the candidate, but it also wastes the time of the recruiter… increasing recruitment costs and delaying the time-to-hire.
Dating apps like Tinder and Hinge ensure users immediately disclose their hobbies and interests to ensure a suitable match… so it should be the same for hiring. The needs of the business and the needs of the candidates must overlap to ensure compatibility, but how would the candidate know compatibility if a key piece of information is missing?
Argument #4: Know their worth.
Contrary to popular belief, candidates know their worth and what they should be paid. The more experienced the candidate becomes, the more they learn about their capabilities, strengths, skills, and value. This isn’t to say a candidate knows the exact dollar amount they should be paid, and what they say goes, but they definitely have a rough idea of where their salary should sit.
So, why would they apply & accept a job that offers significantly less than what they believe they should be making?
Usually, the required years of experience is a great indicator of salary, however, this does differ from company to company. So why not tell them and save the guessing? Not being transparent with salary says just as much as being transparent with salary, and good candidates who know their worth won’t bother with companies who aren’t transparent.
Thus, employers may not want to disclose salary in order to keep quality candidates engaged, but the opposite may end up occurring.
Argument #1: We want candidates who are interested in the job.
Employers are interested in candidates who they believe will add the greatest value to the existing workforce. They must ensure the right hiring decision is made to avoid internal conflict and a re-hiring process if the candidate sadly doesn’t work out.
For this reason, there’s a significant amount of pressure on recruiters and in-house HR departments to choose the right candidate, and they don’t want to attract candidates who are solely interested in the salary.
They want candidates who believe they possess the necessary skills to excel at the job, who are interested in the company, who are attracted to the perceived culture and opportunity… not just money.
Argument #2: Salary may be negotiable.
Like many things in life, a salary is never set in stone. The final salary is commonly dependent on the chosen candidate. Sure, the hiring company will have an expected budget, but a budget is only that! How many times have you budgeted and overspent?
A company may find a candidate who they believe is going to be pivotal in the success of the business, and offer more than they initially agreed upon purely because of the perceived value of the candidate.
Therefore, the initial salary is circumstantial, and the offered salary will change depending on the candidate’s experience, skills, etc.
Thus, recruiters don’t want to deter candidates from applying to the job purely because the numerical figure isn’t high enough for them… because it could change!
It’s only once the hiring company gets a taste of the candidate pool and better determines their ideal candidate, that they will have a clearer idea of salary.
Argument #3: We request their salary expectation.
In order to gain a surface understanding of the candidates’ needs, the recruiter will ask the candidate’s salary expectation, most times in the initial phone screen.
This is where candidates have the power to set the stage, convey their requirements and offer their perspective. In turn, salary becomes a conversation with context, rather than a numerical figure on a job listing. Is this not enough?
Based on the candidate’s answer, the recruiter can determine whether or not the company can meet the expectations outlined by the candidate, and whether they continue with the interviewing process.
It’s important to note the same decision can be made by candidates! From this conversation and the engagement or reaction from the recruiter, the candidate can determine whether the company is suitable for them and whether they will invest their time into the application process.
Argument #4: Competitors!
Businesses operating in the same industry (aka, competitors) usually overlap with ideal candidates. The operations of the business may differ, but the desired skill set will be very similar. To be cynical, depending on the current life cycle of business they may be seeking the same candidate at the same time, however, usually they are attracting professionals from the same candidate pool.
The main point of differentiation is the company culture, brand, operations, and benefits. Because of this, recruiters want to attract candidates based on their preferences of these aspects, and not salary.
If a business discloses their offering salary in the job advertisement, and their competitor sees it, the competitor could simply offer a higher salary for the same position. This reduces the first business’ chance of securing the candidate and gives the competitor the upper hand. This could turn into a bidding war, similar to an action. Simply put, it’s bad for business.
Disclosing the salary on the job advertisement keeps candidates and employers on the same page. Business transparency is highly regarded by candidates and recommended by authorities, therefore disclosing the salary ensures a business’ transparency has no exceptions.
Deterring quality candidates.
Although employers may be concerned they’re deterring quality candidates from applying if they disclose the salary, the truth is this: employers will have a rough estimate of what they’re willing to offer, and disclosing this with a statement “Negotiable” or something similar simply provides basic context.
At the end of the day, the employment is mutually dependent on the candidate and employer satisfaction. Besides, why would you want to attract candidates you can’t afford? This also assists in creating a refined candidate selection, which reduces recruitment costs and shortens the time to hire.
Salary isn’t the end-all.
Lastly, candidates nowadays aren’t purely focused on salary, there are many alternative factors that come into play when deciding on a company. For example, remote working options, healthcare, parking, workplace culture, progression, etc. Just because the salary is exposed it doesn’t guarantee a candidate won’t apply if all other requirements are met and there’s clear company and career progression.
Recommendation #1: Do A/B testing!
Why not test out what works best for your business!
Draft up two job advertisements, one with the salary and one without. Now, how you choose to execute A/B testing is entirely up to you.
Whether you post the same advertisement (with/without salary) to different job boards and analyse the number and type of candidates that apply, or post different role advertisements at different times and analyse the results of both… the choice is yours.
This will be effective in determining the impact of the salary variable as long as you have your controlled variables in place! Your control variable includes things like:
- Length of application ad
- Location of company
- Application process
- Job board
Once you have executed your A/B test, you will analyse the data collated against previous data, including:
- What job board historically has worked best for your company
- The average number of candidates applying to your jobs in the past
- The quality of applicants: ie, how many are immediately unsuccessful
- Your average time to hire
This will give you a great idea of the impact of including/excluding salary for your company.
Recommendation #2: Speak to your existing employees.
Your employees are your biggest asset, make sure to use them. After all, at a point in time, they were your candidates too. Have an open and honest conversation with them, and gather primary information on how important including the salary is.
Ask them if it would have changed their mind, and if it would be something they would look for when applying to a position now.
Recommendation #3: Investigate what other companies are doing.
Put your head down, roll up your sleeves, and do a bit of homework! It’s called R&D baby.
Look at current job boards to see what other companies are doing and adopt practices you perceive to be of value. Make notes, test ideas, speak to fellow HR professionals and put a strategy in place.
At the end of the day, there’s no right or wrong answer to this question… and there probably never will be.
I hope that shedding light on both perspectives has better-helped recruiters and candidates see eye to eye, and that my recommendations help advance your recruitment process!
Until next time.