“Competitive Salary” Signals Low Pay (Add a Pay Range)

Listing “competitive salary” in job ads is no longer good enough for today's job seekers, who want to see a pay range.

For a long time now, hiring teams have tried to boost their job ads by stating they offer a competitive salary. It’s a step up from ignoring pay altogether, but the term “competitive salary” actually works against the job ad. Including it is long-standing practice, but today’s job seekers want something new – pay transparency. (As do many local and state governments.) 

Using “competitive salary,” “pay commensurate with experience,” or a similar phrase can deter qualified job seekers. It can reduce the size and quality of your applicant pools, and it can put you out of compliance with pay transparency laws too. These days, it’s better to replace “competitive salary” with a pay range (a realistic one). 


What does “competitive salary” in a job ad signal?

It varies. To companies, “competitive salary” mostly means pay that meets or exceeds the average for that type of position. To job seekers, it can signal below-market pay. While many job ads include the term, it may not make the job more attractive to job seekers.

In fact, “competitive salary” in job ads problematic for a few reasons. It can signal below-market pay, it doesn’t adhere to new pay transparency laws, and (most importantly) it’s not what today’s job seekers want to see. 


Why “competitive salary” is problematic

First, it can signal below-market pay. Behind the scenes, companies can do their best to meet or exceed the industry average. But that effort is undermined by using the term.

Second, it doesn’t follow the trend of pay transparency laws. More companies are publishing pay ranges all the time. (Including companies publishing ranges that are too broad to have any meaning, unfortunately.) And more jurisdictions are enacting laws requiring pay ranges in job posts all the time. 

Third and most important, today’s job seekers want pay transparency. In an April 2022 survey by Indeed, 75% of respondents said a pay range makes them more likely to apply (according to the Seattle Times). In a 2023 survey by ResumeLab, 87% of respondents said job ads should “always” include a pay range.


Why a pay range instead

When consumers want something, companies offer it to them. It’s the same for recruiting. Job seekers want to see a pay range so they don’t waste their time. It’s in employers’ best interest to offer a pay range to them, even before local or state laws require it.

87% of participants believed that job postings should always include a salary range.
ResumeLab

A pay range empowers job seekers. If they know what a salary is, they can judge for themselves whether it’s competitive. A range also helps reduce salary disparity (e.g., the gender gap) and can nip discrimination in the bud. Basically, the salary range is out there, locked in for all to see. So it doesn’t matter who is in the position because pay is based solely on the job.

But pay transparency can also benefit your company by attracting more qualified candidate pools. 

It saves [companies] the time and energy of searching through candidates who are never going to accept the job. People will self-select out when the [salary] is too little.
Equal Pay Negotiations Founder Katie Donovan (to CNN)

And, added Donovan, transparency upfront can help establish trust between a job seeker and an employer. 

“They feel more respected and apply more when there is the information,” she told CNN. “It’s like: ‘OK, they are treating me like a human being.’”

Pay transparency can also help attract larger candidate pools by giving job seekers what they want – information. (Again, 75% of respondents in the Indeed survey were more likely to apply to a job that included a pay range.)

In fact, Scott Dobroski, Indeed’s vice president of corporate communications, told the Seattle Times that he considers pay a core piece of information.

“This is a basic question: How much am I going to get paid?” he said. “It sets expectations up front. Is this a job they even want to apply for? And, if they applied and actually got [it], would they be satisfied with the job?” 


Ditch “competitive salary,” add a pay range

Today’s job seekers want to see specifics in job posts. They want to know what it’s actually like to work at your company. And it’s not just about pay. They also want to see specifics on job location, health care, paid time off, retirement plans, stock options, and any other benefits in job posts. (They even want to see your stance on diversity, equity, inclusion, and belonging.)

But pay is a key first step. Going through the hiring process when the money isn’t right is a waste of time for both you and your applicants. It’s better to include a pay range in your job ads right upfront. After all, it’s what today’s job seekers – your customers – want.

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