Salary Surveys: A Tool for Smarter Compensation Strategies

Let’s face it, compensation is usually the most critical component of a job offer, both for employers and prospective candidates. Particularly for employers, compensation can be tricky. Between staying competitive, promoting fairness, and attracting and retaining top talent, maintaining a strong and updated compensation strategy may feel like trying to hit a moving target. One moment your pay structure feels spot on, and then a competitor seemingly comes out of nowhere, with an offer that someone on your team or a prospective candidate can’t refuse. 

So, how do you keep up? That’s where salary surveys come in. 

These surveys are a key tool Human Resources (HR) uses to benchmark compensation in today’s fiercely competitive job market. Here at OutSolve, our experts analyze and use this external data to help clients sync their pay strategies with real world, data driven considerations. 

Let’s get into more detail about what a salary survey is, why it’s so important, and how you can use it to strengthen your company’s compensation strategy. 

Here’s three key takeaways you’ll learn in this article: 

1. The various components of a salary survey 
2. What value salary surveys can add to your compensation strategy 
3. Best practices for HR on using salary survey data 

What Is a Salary Survey? 

A salary survey, sometimes referred to as a salary compensation survey, is a tool that collects data about pay rates for specific job titles across different industries, regions, and levels of experience. Think of it as a snapshot of what the market is currently paying for a particular role. 

The purpose? To assist employers and employees in understanding what various jobs pay in different geographic areas, and to identify trends in wage and salary levels. A salary survey can also help employers benchmark their salaries against those of their competitors. 

These surveys typically gather information such as: 

• Job title 
• Job description or function 
• Geographic location 
• Industry 
• Company size 
• Years of experience 
• Education level 
• Median or average salary 
• Bonuses and other benefits 

Once the data is collected, it's analyzed and validated by internal compensation experts or external survey firms to confirm accuracy. Outliers are removed, and the results are packaged into a clean and easy-to-understand report that HR teams can use for their compensation decisions.  

Why Salary Surveys Matter for Your Compensation Strategy 

Salary surveys are foundational to building a compensation strategy that’s both competitive and equitable. Here’s why: 

1. Market Competitiveness: One of the most obvious benefits is knowing how your pay stands up against the market. If you're offering compensation that is below the market, then you're at risk of losing talent. On the flip side, paying above market can give you a competitive edge, but it may be short-term, so you’ll need to make sure that it’s sustainable longer-term. 

2. Promoting Pay Equity: Salary surveys help you benchmark pay across roles, genders, and demographics, supporting efforts to identify and close any wage gaps. They provide the objective data needed for a fair and transparent compensation structure. 

3. Supporting Recruitment and Retention: In today’s candidate driven market, competitive pay is one of the top reasons employees accept or decline offers. With salary surveys, you have accurate data that helps you make attractive job offers and keeps your current team from wandering to another employer. 

4. Making Data-Driven Decisions: Forget gut feelings or outdated spreadsheets. Salary surveys provide you with current and reliable data that helps guide compensation decisions with confidence. 

5. Building Employee Trust: When employees know their pay is based on objective benchmarks, they’re more likely to view the company as fair and transparent. That’s a huge win, especially for morale and culture. 

Best Practices for Using Salary Survey Data 

Of course, not all salary survey data is created equal. To get the most value, here are a few critical tips: 

• Use reputable sources: Stick with surveys from well-known firms or compensation specialists. If you’re unsure where to start, or experts here at OutSolve can help. 
• Compare “apples to apples”: Make sure you're comparing similar roles, industries, and geographic areas. A software developer in San Francisco, CA earns very differently from one in Des Moines, IA. 
• Review data regularly: The market moves fast. Make it a habit to review salary surveys at least annually to stay current. Otherwise, you’ll be working with outdated information that can negatively impact your overall compensation strategy. 

How to Get Salary Survey Data 

Here’s a common question: Can HR teams get salary survey data themselves? 

The short answer is yes, but with a few caveats. 

You can purchase reports from reputable vendors or industry associations. There are some organizations that even contribute to surveys in exchange for free or discounted access. But understanding the data, and applying it effectively, can be challenging and time consuming, especially if you’re not a compensation specialist. 

That’s where partnering with a compensation consultant, such as OutSolve, can make all the difference. 

How OutSolve Uses Salary Surveys for Smarter Compensation Benchmarking 

At OutSolve, salary surveys are a major component of how we help clients build competitive, equitable compensation strategies. 

We combine external benchmarking and using salary survey data with internal analyses to give you a comprehensive view of your pay practices. This dual approach helps answer questions like: 

• Are we paying competitively for this role in this market? 
• Do we have any pay equity issues across departments or demographics? 
• Is our salary structure aligned with our business goals? 

We don’t stop at data. We integrate these insights into broader services like pay transparency strategies, pay equity audits, and market alignment reviews 

Want to see how we approach compensation holistically? Check out our Compensation Benchmarking guide. 

Is Your Compensation Strategy Working? Take the Quiz! 

Still wondering how your current pay structure stacks up? We’ve created an interactive tool to help you figure that out. Take this Compensation Quiz. It’s quick, easy, and helps you uncover things like gaps in your current strategy, areas where you’re excelling, and next steps to take your compensation to the next level. 

Whether you're just starting your benchmarking journey or refining an existing strategy, this quiz is a great place to start.