Attracting the talent you need can be challenging for any business, but small businesses can find it particularly difficult. Transparency and openness is a key value for many candidates, and the way job advertisements are crafted when it comes to pay information can significantly impact the quality and quantity of applicants a small business gets.
Many managers and business owners feel instinctively ‘cagey’ about salary decisions, but moving away from vague terms like ‘attractive salary’ or ‘competitive pay’ to clear, concrete pay information can have numerous benefits.
1. Attracts the right candidates
Clear pay information helps attract candidates who are more likely to accept the offered salary, reducing the time and resources spent on interviewing candidates whose salary expectations do not align with what the business can offer.
Using terms like ‘attractive salary’ can deter potential candidates who might assume the salary does not meet their expectations. This vagueness can result in missing out on highly qualified individuals. An advert for a job would normally contain all the most attractive features of the role, workplace or employer. If salary is not clear, applicants may assume it isn’t an attractive feature!
2. Increases application rate
Evidence shows job seekers are more likely to apply for positions with transparent salary details. This openness can lead to a larger pool of applicants, giving small businesses a better chance of finding the ideal candidate.
3. Saves time
By being upfront about salary, businesses save time for both themselves and potential employees. Candidates know what to expect before entering the application process, which minimises the chances of a breakdown in negotiations at a later stage.
On the other hand, vague salary descriptions often lead to a mismatch in expectations, resulting in wasted time and resources during the recruitment process. Candidates may go through several interview stages only to decline the offer when the salary is finally disclosed.
4. Promotes pay equity
Transparently posting salary ranges demonstrates a commitment to fair pay practices. It shows that the business values equity and is open about its pay structures, which can be particularly appealing to candidates concerned about workplace equality.
5. Enhances company reputation
Transparency in pay is often seen as a reflection of a company’s ethics and business practices. By being clear about salaries, small businesses can enhance their reputation as trustworthy and straightforward employers.
Opaque salary language can create a perception of a lack of transparency or fairness within the company, potentially harming the business’s reputation in the job market.
6. Improves employee satisfaction and retention
Employees who join the company with clear expectations about pay are less likely to feel undervalued or misled. This clarity can lead to higher job satisfaction and, in turn, better employee retention rates.
7. Reduces potential for unconscious bias
Without clear salary ranges, there’s a higher risk of salary decisions being influenced by unconscious biases. This can lead to inconsistencies in pay that might affect certain groups of employees unfairly.
Including clear pay information in job advertisements attracts the right candidates, saves time and resources, promotes equity, and enhances the company’s reputation. On the other hand, vague salary terms can lead to missed opportunities, wasted resources, negative perceptions, and potential pay inequities.
If you’re concerned because you genuinely don’t know how much you’ll pay the successful candidate as it will depend on their skills and experience, that’s fine, but give an indication or a range instead. You don’t need to be exact. And if you’re concerned because you don’t want current employees to know how much the new person will be paid, perhaps reflect on why that is – if pay decisions are made fairly and are based on the right factors, a bit more transparency won’t do any harm.
If you’d like further advice on how to make your job advertisements really effective, do get in touch.