Tag: market data

regularly participating in salary surveys

WHY REGULARLY PARTICIPATING IN SALARY SURVEYS IS VITAL FOR YOUR ORGANIZATION

Written by Kai Donesa on . Posted in Resources.

Setting competitive pay is not a guessing game—it is a strategy. But without up-to-date labor market data, you risk underpaying or overpaying talent, breeding resentment, or draining resources.  

Salary surveys are your guideposts. These tools unveil market trends, helping you set fair and informed compensation that attracts top talent, boosts morale, and builds a stellar employer brand. Regularly participating in salary surveys gives you a bird’s-eye view of the labor market—a broader perspective to make informed pay decisions. 

Invest in fairness and data-driven pay practices by joining salary surveys every year. Participating annually—even if your organization is not yet due for a salary review—keeps you on top of labor market trends. Taking part every year also allows you to budget accordingly when salaries are due for updating.  

Gain insights into competitive pay practices and secure your place as an employer of choice. This blog post will guide you through the importance of salary surveys and the benefits of regular participation. Let us map your organization’s path to compensation clarity. 

Understanding salary surveys

Before we go into the benefits, let us demystify the concept. 

Salary surveys capture compensation trends across sectors or labor markets. Such surveys collect data on a range of factors—including base salary, bonuses, and benefits—and analyze them to reveal valuable benchmarks for different roles and job grade levels. 

The information gleaned from these surveys is invaluable, as it helps your organization know its standing in the market and make the necessary adjustments to its compensation strategy. 

Regularly participating in salary surveys also ensures your data is always current. It helps you stay in tune with market trends and react promptly to changes. Furthermore, it provides a holistic view of the sector’s compensation landscape, enabling your organization to develop a comprehensive and competitive compensation strategy. 

Using salary surveys effectively 

To effectively use data from salary surveys, take a step back and ask a crucial question: “Who are we as an employer?”. The answer shapes your Employee Value Proposition (EVP) and defines your unique position in the labor market. It encompasses two key aspects: 

  1. Target market composition. Who are your competitors for talent? Identify companies of similar size, industry, and market to serve as relevant comparators in your surveys. 
  1. Target market position. Where do you want to stand in terms of salary competitiveness? Do you aim to be at the market average, attract top talent with higher pay, or be cost-conscious with a lower-than-average position? 

Remember, salary surveys are a compass. They offer valuable data, but your compensation policy drives your decisions. 

  1. Consistent criteria for comparators. Use the same factors to select comparators every time, ensuring accurate and reliable comparisons. 
  1. Finding your sweet spot. Define your target percentile based on your EVP. Do you want to be in the top 10% for attracting high performers, or are you comfortable with the median to control costs?  
  1. EVP alignment. Design your compensation practices to reflect your EVP, offering benefits and pay structures that resonate with your desired talent pool.  
  1. Market-aware adjustments. Stay informed about market trends and competitor offerings revealed by salary surveys. Use this data to make informed adjustments to your compensation package, including base salary, bonuses, and benefits. 

Ultimately, your compensation budget and target market position are the driving forces behind your pay structure. Salary surveys act as a valuable tool to calibrate your offerings, stay competitive, and attract the talent you need. 

Reaping the rewards of regular participation 

Participating in salary surveys is not just a box to check; it is an investment in your organization’s success. Frequently taking part in salary surveys offers a wealth of benefits: 

Competitive benchmarking 

Stay competitive in the labor market by understanding how your compensation stacks up against the best. By regularly participating in salary surveys, you can: 

  • Find any gaps. Once you determine how competitive you want to be in your chosen market position, surveys can help point out areas where your compensation falls short, allowing you to adjust your organization’s strategies. 
  • Know your market position. Understand how your salaries compare to sector averages and market leaders. Are you leading the pack or falling behind? 
  • Stay ahead of the curve. Predict compensation (salary and benefits) trends and proactively adjust your total compensation packages to keep top talent and attract recruits. 

By using the insights from salary surveys, you can ensure your organization remains an attractive employer, allowing you to win the war for talent. 

Equity and fairness 

Regularly taking part in salary surveys helps promote pay equity and fairness. By taking advantage of salary surveys, you can: 

  • Bridge the pay gap. Equity is ensuring you pay for the role and not the person. Eliminate pay discrepancies and ensure internal equity. Use salary survey data rather than the person’s pay history to inform compensation management policies, building a workplace where everyone is rewarded fairly. 
  • Craft a more equitable structure. Use data-driven insights to adjust your salary scale, ensuring fairness and alignment with industry standards. 
  • Build trust and transparency. Open communication and data-backed pay decisions foster a culture of trust and respect, leading to a more positive work environment. 

Investing in salary surveys is an investment in your staff and your organization’s success. By ensuring fair and transparent compensation, you can build a more motivated, engaged, and inclusive workforce, driving positive outcomes for everyone. 

Informed compensation decisions 

Salary surveys, far from being data dumps, can be your secret to building a winning human resources strategy that attracts, retains, and unlocks the full potential of your workforce.  

Joining salary surveys every year can improve your compensation practices by enabling you to look beyond the numbers. While salary is essential, salary surveys can help you assess what employees value—flexible work arrangements, learning and development opportunities, and recognition and reward programs.  

Design compensation packages that go beyond the paycheck. While compensation is the biggest draw, in some markets, having the right benefits can also help keep your competitive edge.   

Salary surveys are a treasure trove of insights and analysis waiting to be unlocked. You can build a compensation strategy that attracts and keeps top talent by harnessing their power. 

Attract and retain top talent 

Attracting and keeping staff needs a data-driven, strategic approach. Gone are the days of generic offers and one-size-fits-all solutions. Organizations must cultivate a compelling employer value proposition that resonates with skilled talent.  

  • Become an employer of choice. Offering competitive salaries and attractive benefits packages, informed by reliable survey data, makes you a magnet for top talent, enhancing your employer brand and reputation.  
  • Tailor your strategies. Use survey insights to understand your target audience’s compensation expectations and tailor your recruitment and retention strategies accordingly.  
  • Predict and prevent turnover. Find potential risks by comparing your packages to what market leaders offer for similar roles. Adjusting based on the latest data can keep your employees engaged and committed. 

Leveraging robust salary surveys is not just a good practice; it is a competitive advantage. Understanding market rates empowers you to craft compelling compensation packages that attract target candidates and ensure internal equity. The result? Increased employee satisfaction, reduced turnover, and a more dynamic workforce. 

From insights to action 

Regular participation in salary surveys empowers you to make informed compensation decisions, attract and retain top talent, and cultivate a healthy, high-performing organization. Do not miss out on this invaluable resource. Birches Group provides labor market data in over 150 countries, and we are here to help. Register for our comprehensive salary surveys today and secure your organization’s future success or get in touch with us to learn more. 

Carla is a part-time copywriter on our marketing team in Manila. Before shifting to freelance writing in 2020, she worked as a marketing and communications specialist at the offices of EY and Grant Thornton. She has written about HR and career development for Kalibrr.

Follow us on LinkedIn for more content on pay management and HR solutions.

Unraveling the Complexity: Useful Strategies for Managing Amid Uncertain Times

UNRAVELING THE COMPLEXITY – USEFUL STRATEGIES FOR MANAGING COMPENSATION AMID UNCERTAIN TIMES

Written by Kai Donesa on . Posted in Resources.

Navigating volatility is essential in a world where the only constant is change. Managing amid uncertain times is a necessary skill that demands resilience, agile decision-making, and a shift in perspective.

This blog post provides the mindset, tools, and actionable strategies to help you face labor market challenges head-on and deliver results regardless of the circumstances. We’ll share a roadmap grounded in our years of experience serving clients across emerging markets, with insights you can apply to your organization. Equip yourself with a resource that helps you stay resilient and adapt to the rapid pace of change.

The nature of volatility

Volatility is often used in finance, but its application extends beyond stocks and bonds. In the broader sense, volatility refers to the degree of variation or instability. In the business continuity context, this could mean unforeseen circumstances that disrupt the normal dynamics of the labor market.

Examples of volatility include:

  • Hyperinflation, devaluation, and other economic events
  • Natural disasters, such as earthquakes
  • Periods of unrest, civil war, or armed conflict

The key lies in understanding volatility and learning how to manage it. In this way, you can ensure your organization’s sustainability.

Remember, uncertainty is part of the world we live in. Accepting this is the first step to managing it effectively.

The need for strategic planning in HR

Human resources (HR) plays a crucial role in managing volatility. As the hub for workforce management, HR helps ensure the organization’s stability while adapting to changing circumstances. Your people are your greatest asset, and ensuring staff feel secure and supported is important.

Strategic planning in HR is, thus, essential. Planning involves identifying, managing, and mitigating risks and ensuring the organization has the right tools and policies to address them. Planning allows HR to anticipate and prepare for volatility rather than merely reacting. It’s about thinking ahead.

Strategic planning also fosters a proactive culture within the organization. By actively seeking out and addressing issues, HR can inspire employee confidence, encouraging a sense of security and stability even during uncertain times.

Key strategies and tools to manage volatility

Managing volatility effectively requires both strategic thinking and practical action. Here are a few key strategies and tools that can help you navigate uncertain times with resilience:

Stay updated on news and current events. Knowledge is power. Staying informed about current affairs around the world is essential, particularly during times of uncertainty. We recommend you begin by reading our headline articles, which provide the latest updates on local market conditions.

Monitor labor market movement. In a dynamic global economy, it is crucial to watch for changes in labor markets. This involves keeping a firm pulse using reliable resources, such as our bi-monthly Market Monitor report. Our report draws insights from our diligent monitoring of exchange rate movements of local currencies against the United States dollar, euro, and other major currencies.

We mainly focus on emerging markets, given their inherent volatility and susceptibility to unexpected events. This strategy allows us to provide relevant and insightful data, ensuring you can react to market trends.

Define your Compensation Policy. Another strategy is to define how your organization will remunerate its employees. The Compensation Policy includes the mechanics for paying base salary, cash and in-kind benefits, as well as non-salary and after-service benefits, providing a holistic view of the total compensation structure. The policy builds transparency, setting clear expectations for compensating staff.

Establish your Special Measures Policy. Staff want to rely on you to support them during a crisis. Managers want to be able to make decisions quickly in challenging times. A clear Special Measures Policy addresses these concerns. This policy, designed to supplement your existing Compensation Policy, outlines what the organization will do when certain uncontrollable events—like hyperinflation or a natural disaster—occur and monitoring the labor market is no longer sufficient.

Get in touch with consultants and other employers. No organization is an island. Reach out to consultants and other employers for insights and collaboration. It’s crucial to foster a shared understanding of labor market trends and devise responses to market volatility.

Additionally, engaging with an HR consultancy like Birches Group can help you gain valuable insights into the intricacies of HR management. Open dialogues with industry peers can offer a diverse perspective on handling workforce challenges, helping your organization thrive amidst uncertain times.

Case Study: Effective HR Management in Times of Volatility

To illustrate how you can apply these tools and strategies in a real-world context, let’s look at a case study: a global public health initiative operating in markets where economic conditions can become unsettled due to a range of factors. During such situations, the Initiative recognizes the need to support its staff in facing hardships related to volatility.

The Initiative has tapped the expertise of Birches Group in designing a Special Measures Policy to address the challenges posed by market instability and to ensure the continuity of its operations while upholding its core principles. The policy is driven by key objectives such as business continuity, staff assistance, and competitiveness.

Birches Group designed a Special Measures Policy that covers the following:

  • The conditions that will trigger the start of the policy,
  • The measures that will be applied, and
  • The level of coordination involved in conducting the policy.

The policy provided the Initiative with a systematic approach to responding to instabilities in local markets. Establishing such a policy also allowed the Initiative to take the lead in helping staff amid uncertainty while being mindful of actions taken in the market.

The Initiative has taken a proactive approach to implementing special measures when necessary. The organization checks market conditions, assesses the impact on its staff, and considers the broader economic context.

Being proactive amidst uncertain times

In the face of volatility, be proactive rather than reactive. This involves anticipating changes, planning for various scenarios, and continually striving for improvement. It’s about taking charge of the situation rather than simply reacting.

Remember, being proactive means being ready for whatever comes your way. By applying our recommended tools and strategies, you can confidently navigate uncertain times and ensure your organization’s sustainability in the face of volatility.

How Birches Group can help you manage volatility

At Birches Group, we understand the challenges of managing volatility and are here to help. We offer various HR services and tools to help you navigate uncertain times effectively. Whether through sharing guides and resources or designing your organization’s Compensation or Special Measures policy, we can support you in navigating volatility successfully.

As a global HR consultancy, Birches Group offers tools and strategies to manage volatility effectively. Our team of experienced consultants can help you understand the nature of volatility and develop appropriate policies.

Does your organization need guidance in managing staff amid uncertain times? Contact us today.

Carla is a part-time copywriter in our marketing team in Manila. Before shifting to freelance writing in 2020, she worked as a marketing and communications specialist at the offices of EY and Grant Thornton. She has written about HR and career development for Kalibrr.

Follow us on LinkedIn for more content on pay management and HR solutions.

A group of people sitting around a table in an office.

WHY ORGANIZATIONS SHOULD OUTSOURCE THEIR SALARY SCALE DESIGN

Written by Kai Donesa on . Posted in Resources.

Organizations are beginning to recognize that the key to attracting and retaining top talent hinges heavily on a strategic, fair, and competitive salary scale. Yet, tailoring this structure to your unique needs can be complex.

Do you have the tools to properly analyze labor market data? Can your human resources (HR) team maintain the salary scale annually, in addition to addressing other responsibilities? Is there a way to design and update your salary scale more efficiently? This is where outsourcing is necessary.

Outsourcing the design and maintenance of your salary scale unburdens you and your HR team from this intricate task, allowing you to focus on your core business operations. Handing this responsibility over to more experienced professionals does not only save time; it ensures that your salary scale aligns with your strategic goals, global policies, market trends, and industry standards.

This article discusses why organizations should consider outsourcing the design and maintenance of their salary scale. We will explore how this pragmatic move can help you, from gaining expert advice to ensuring market alignment. If you’ve been second-guessing whether you need to outsource your salary scale design, our insights might be what you need to make an informed decision.

Understanding salary scale design

Your salary scale is the single most important document in HR. The structure determines how much an employee will be paid based on their role, their value for experience at each grade level, and the difference between one grade level to the next. It tells your stakeholders everything they need to know about your organization, including:

  • How you position yourself in the market
  • What value you place on your jobs
  • How you manage relationships across jobs
  • What are the possible career progressions
  • Where you stand on equity and transparency

A well-balanced salary scale is crucial for your people to work efficiently and achieve team cohesion. Your salary scale drives all other HR programs, including recruitment, staff retention, promotion, and career development.

Designing the scale is not only about deciding how much to pay an employee or listing pay grades. It is driven by building a fair and equitable compensation structure that shows how you attract and retain talent, as well as motivate staff. It involves balancing internal considerations and team dynamics with the external market.

However, designing and updating your salary scale requires a deep understanding of your business strategy, a thorough knowledge of the labor market, and keen insight into the motivations and expectations of staff. These tasks demand a high level of skill, expertise, and experience.

Why it’s essential to have a well-designed salary scale

A well-designed salary scale establishes a framework for determining staff compensation and sets the standard for pay equity within your organization. It also helps ensure employees are rewarded fairly, boosting morale and motivation.

Your salary scale also serves as a roadmap for career progression, giving staff a clear idea of what they can expect as they advance. This transparency can help foster trust and loyalty among staff, leading to increased job satisfaction and lower turnover rates.

Further, a well-designed and updated salary scale can help your organization attract and retain top talent. By offering competitive salaries in line with market rates, you can position your organization as an employer of choice.

Common challenges in designing a salary scale

Designing a salary scale is not without its challenges, though. One of the fundamental issues is determining the appropriate pay range for each grade level within your organization. This requires a thorough understanding of the job market and the ability to assess the value of each level accurately, carefully balancing your organization’s workforce needs and overall budget.

Another challenge is ensuring pay equity. This involves making sure employees are paid fairly for their work. Achieving pay equity can be complicated, especially in large organizations with a diverse workforce across labor markets.

Keeping the salary scale up to date is also a concern. The job market constantly evolves, and the value of specific roles can change rapidly. The salary scale must be updated every year to reflect market trends.

The benefits of outsourcing salary scale design

Outsourcing the design of your salary scale offers several advantages:

  1. First, it frees up valuable time and resources. Designing a salary scale requires a significant amount of time and expertise. By outsourcing this task, your HR team can focus on other vital projects, such as employee engagement and talent development.
  2. Second, outsourcing gives you access to expert knowledge and insights. An HR consultancy firm like Birches Group has a deeper understanding of labor markets across continents. Additionally, firms such as ours can share accurate and timely information about salary trends and benchmarks.
  3. Finally, outsourcing ensures fairness and objectivity. An external firm can design a salary scale free of internal biases or conflicts of interest.

Case study: Elizabeth Glaser Pediatric AIDS Foundation

To illustrate the benefits of outsourcing your salary scale design and maintenance, let’s consider the case of the Elizabeth Glaser Pediatric AIDS Foundation (EGPAF), a nonprofit organization supporting activities in 19 countries. EGPAF had a centralized salary system but needed to ensure its salary scales kept up with the market, especially in Africa.

EGPAF tapped us to design its salary scale over several years. Doing so refined the nonprofit’s salary scales with a view closer to the local setting. We then looked at each African location, improving EGPAF’s pay structures and systems based on our NGO Surveys. Based on their budget, we developed three different salary scale options for each country.

As a result, EGPAF can now:

  • Name which comparators are relevant to them based on consistent comparator criteria developed for their salary scale review, and which scale design approach best addressed its internal compensation issues, all while staying within budget.
  • Get a more precise snapshot of the labor market through our salary survey data.
  • Anticipate and be better equipped when sudden changes in the market occur.

This case illustrates the significant benefits that can be gained from outsourcing your salary scale design.

How Birches Group can help you design and update your salary scale

Creating and maintaining a salary scale is a technical and creative process best left to specialists. If you’re considering developing or updating your organization’s salary scale, we at Birches Group are here to help. With our team of experienced professionals, we can provide salary scale options tailored to your needs.

We have extensive expertise in adapting or creating salary structures through our work with many clients from the public and private sectors. We believe proper salary scale design must be tailored to your needs and culture, as well as your compensation philosophy, market position, and budget. A well-designed salary scale must also align with the local market and adhere to corporate policy and compensation goals.

If you’re ready to learn more about how we can design and maintain your salary scale, contact us today.

Carla is a part-time copywriter in our marketing team in Manila. Before shifting to freelance writing in 2020, she worked as a marketing and communications specialist at the offices of EY and Grant Thornton. She has written about HR and career development for Kalibrr. 

Follow us on our LinkedIn for more content on pay management and HR solutions.

Strategy in Sub-Saharan Africa

Vital Partners, Shared Priorities: The US Strategy Towards Sub-Saharan Africa

Written by Kai Donesa on . Posted in Uncategorized.

Birches Group monitors labor markets that are making headlines worldwide and wants to share news and updates on the current conditions in these markets.

The White House released in August 2022 the US strategy toward Sub-Saharan Africa (SSA). Its renewed policy supports four main objectives, including advancing pandemic recovery and economic opportunity.

A priority and opportunity

SSA is of growing importance on the world stage. Comprising 49 countries, the region is a geopolitical priority and an emerging economic opportunity. SSA countries hold roughly 25% of United Nations General Assembly seats. Moreover, the region is integrating into the world’s largest free trade area.

The US Department of Commerce’s International Trade Administration describes SSA as presenting real opportunity, with indicators such as:

  • A combined market population of over 1.2 billion people (that is expected to double by 2050),
  • A gross domestic product of more than US$1.5 trillion, and
  • Home to some of the fastest-growing economies in the world.

The World Bank reports that economic activity in the area is set to expand by 3.6% in 2022, 3.9% in 2023, and 4.2% in 2024. Additionally, its young population makes SSA an attractive investment destination. Massive demographic shifts in this part of the world provide tremendous opportunities to create jobs, boost incomes, and reduce poverty, especially in a global environment of slowing growth.

China and its growing influence in the region

The world is well aware of Africa’s importance, encouraging countries to expand their political, economic, and security engagement with African states. In the past 20 years, new actors, such as China, have been shifting dynamics across SSA. And Chinese influence in the region is real and significant.

In 2001, China received less than 3% of the region’s exports, compared to nearly 19% for the US. In 2009, China overtook the US as SSA’s largest trading partner. Almost 20 years later, China has emerged as the region’s single greatest export partner, holding an 11% share of exports in 2019, while the US share dropped to 5%. China’s Belt and Road Initiative has invested in SSA through transportation, power, water supply, and other infrastructure projects. China has also provided loans, investments, and aid.

The US reframes its Sub-Saharan Africa partnership

The US is responding to growing foreign activity and influence in SSA and is engaging a region undergoing significant transformation. “It would be a strategic mistake for the US to abandon its engagement with SSA altogether—especially as US adversaries and competitors are relentlessly increasing their investment in the region…” said Daniel Runde, Director of the Project on Prosperity and Development, and Sundar Ramanujam, Research Associate of the Project on Prosperity and Development at the Center for Strategic & International Studies (CSIS).

Biden’s policy differs from those of previous administrations because it focuses on overhauling its relationship with SSA from donor-recipient to genuine partnership. “Biden’s team extols Africa’s strengths and is proposing US-Africa partnerships on a range of issues,” said Mark Bellamy, Senior Advisor of the Africa Program at CSIS.

Further, Devex reports that the strategy has generally been well-received and is seen as sending a strong message about US engagement in the region. “It’s a strategy that reflects the region’s complexity—its diversity, its power, and its influence—and one that focuses on what we will do with African nations and peoples, not for African nations and peoples,” said US Secretary of State Antony Blinken as he announced the strategy.

It’s also an effort to make regional engagement authentic and not just a battleground to compete with China and Russia. “Too often, African nations have been treated as instruments of other nations’ progress rather than the authors of their own,” added Blinken in his announcement.

Why this matters to employers

With the intent of the US to reestablish ties and reinvest in SSA, employers with a presence in the region can anticipate a significant shift in the labor market in years to come. Monitoring the labor market as early as possible is critical for your organization to seize economic opportunities and remain competitive. Keeping an eye on market shifts enables your organization to plan and make informed decisions about hiring, pay management, employee benefits, and more.

How we can help

We at Birches Group survey leading employers in over 150 countries with a consistent methodology designed for dynamic, emerging markets across SSA. We survey labor markets of varying sizes, focusing on employers that set trends. Get updated and relevant data on every country in SSA. Speak with our consultants today to understand our data and how you can use it for your organization.

References:

Monitor The Labor Market

5 REASONS WHY ORGANIZATIONS SHOULD MONITOR THE LABOR MARKET

Written by Kai Donesa on . Posted in Resources.

The labor market is constantly changing and evolving. It changes to reflect demands and pressures from different sectors, industries, and locations. New jobs emerge, old ones disappear, and wages fluctuate—sometimes due to external forces and local or regional economic factors. Organizations must stay on top of trends and monitor the labor market to remain competitive. Those that don’t keep up risk being left behind and failing to meet the needs of their people.  

One way for organizations to stay ahead is to monitor the labor market. Doing so helps human resources (HR) teams understand how their organization is affected by market movement. Reviewing and interpreting labor market data allows HR teams to address critical questions such as: 

  • How can we determine how much the market pays for similar roles? 
  • How can we competitively position ourselves against our target peers? 
  • How can we become an employer of choice in the local labor market? 

Keeping an eye on the labor market enables organizations to make informed decisions about hiring, pay management, employee benefits, retention strategies, and more.  

This blog post will explore why organizations should track the labor market and how to do so effectively. When the organization knows what is coming, it can plan and ensure it is well-positioned when the opportunity to grow strikes. 

Establishing market composition and position 

Using labor market data can help organizations clearly and consistently establish their competitive strategy, notably their: 

  • Target composition, or which group of employers are similar and more relevant to the organization. Consider organizations from the same sector, employers you lose your staff to, and organizations you often hire staff from.  
  • Target position, or how competitive an organization wants to be. Identify the ideal percentile (e.g., 50th, 75th) of the labor market the organization wishes to attract.  

Determining its target composition and position enables an organization to understand where it stands against key employers in the market. It also guides the organization on what it needs to do to lag, match, or stay ahead of relevant comparators. Organizations must consider their compensation policies and budget to establish their target composition and position. 

Setting benefits 

Labor market data also gives up-to-date insights into benefits widely provided in each country. In addition to salaries, benefits come in the form of cash (allowances and bonuses), in-kind benefits (company bus, gift baskets, company products, etc.), and non-salary benefits (retirement plans, healthcare coverage, family benefits, and leave provisions). 

As the organization reviews compensation and benefits surveys, it can easily identify mandatory, cultural, and market practice benefits, as well as benefits that address local hardships. And while salaries often attract key talent to an organization, benefits make up a significant part of the compensation package in developing markets. By providing the proper compensation and benefits, the organization can remain competitive and retain talent.  

Identifying HR gaps and making the necessary adjustments 

Identifying the gaps in HR practices is another way organizations can benefit from monitoring labor market information. Some of the few questions that organizations will want to address are: 

  • Do our hiring rates remain competitive? 
  • Are we able to retain the talent we need? 
  • Are our employee benefits competitive in the market? 

When the organization encounters talent management issues—such as challenges in attracting the right talent or holding on to staff—it may be time to make adjustments to the compensation package. 

If the organization is looking for data scientists—but hasn’t found suitable candidates—it may be time to rethink the starting salaries to ensure they are comparable to other organizations hiring for a similar job. Or perhaps the organization starts to lose staff after some time. It may need to reassess policies on pay movement, benefits packages, or career advancement to entice staff to stay longer.  

Understanding the impact of the data

Organizations need to go beyond the labor market data. They must understand how changing HR policies and practices in reaction to emerging trends, shifts, and volatility affects staff. So, the question that needs to be addressed is: Do the organization’s policies and initiatives reflect labor market changes and demands? 

A recent example would be the shift from working at a traditional office to working remotely or in a hybrid format. After years of being accustomed to working from home (in response to the COVID-19 pandemic), employees now expect flexible work arrangements—so much that they are willing to leave the organization if it does not offer the option. 

Another example is managing dispersed teams. With many employees now preferring to relocate to places that are sometimes far from the office, how will adjustments to compensation and benefits affect staff based in different areas? Should organizations still base salaries on city rates or adjust them based on where the staff chooses to relocate?

Thus, organizations need to use labor market data and its implications to help inform their policies. Other key questions that organizations need to answer when looking at labor market data include: 

  • Is our compensation program reaching the talent we need? 
  • How can we maintain our relevance in the labor market? 
  • Are there opportunities for improvement? 
  • Will changing our policies and practices help or hurt us? 
  • What are the implications of these changes on staff? 

Managing compensation even through uncertainty 

Now more than ever, organizations need to closely monitor the market. With inflation rising in countries across the globe, employees need to know that their employer has a plan to help them get through turbulent times.  

Organizations can best manage economic turmoil by monitoring the labor market coupled with a special measures policy. When volatility happens, chances are employees are going to ask HR how the organization will help their families manage their day-to-day expenses. When market conditions warrant adjustments to compensation, this is easily defensible when you have the market data to support it.   

When unpredictable events such as economic volatility, natural calamities, armed conflict, and periods of unrest affect the regular dynamics of the labor market, organizations must keep participating and monitoring labor market movement. By doing so, the organization can determine proper triggers, based on data, that would justify changes to compensation and benefits, as well as the frequency to which adjustments are made.  

Bottom line: Know where you stand 

The labor market continues to shift. It may be difficult for organizations to keep up as the market relies on changes from other sectors of the economy and events from around the world. As such, it is critical to keep track of the ever-changing landscape. This ensures that organizations adapt and adjust policies and measures to meet new demands, positioning themselves for success.  

To do this, organizations need up-to-date data about the labor market to know what conditions are like in their area. Tracking the labor market through salary surveys can offer helpful insight into emerging trends that could impact the organization. Monitoring will help employers understand current conditions to make informed decisions about jobs, the market, and skills and performance. In the end, keeping one’s eyes on the labor market helps organizations stay competitive.  

Does your organization need labor market data, especially on developing markets? We at Birches Group offer the most comprehensive salary survey coverage, with data on over 150 countries. We survey markets of varying sizes and focus on leading employers that set trends. Get in touch with our consultants to get started. 

Carla is a part-time copywriter in our marketing team in Manila. Before shifting to freelance writing in 2020, she worked as a marketing and communications specialist at the offices of EY and Grant Thornton. She has written about HR and career development for Kalibrr. 

Follow us on our LinkedIn for more content on pay management and HR solutions.