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Are You Offering Competitive Compensation?

One of the toughest decisions small business owners have to make is how much to pay their employees. Too little and they risk high turnover and low morale; too much, and they’ll never get ahead financially. Calculating salaries is a tightrope walk that few new employers feel comfortable with. Do you know if your salaries are competitive?

Use the right tools
Fortunately, there are a number of readily available tools at your disposal to help you calculate the ideal salary for each employee in your company. It’s important that you use all the resources you can, because your employees are almost certainly already using them, and they know exactly how much they should be making. Start with free tools from the Bureau of Labor statistics like their Consumer Price Index and Employment and Wage Surveys to get a rough idea of the cost of living in your area and average salaries for employees in your industry. For more detailed information, consider using a salary calculator from a site like

Allocate funds
When deciding on compensation for each employee in your company, one of the things you’ll want to consider is which positions you’ll want to offer the most competitive compensation. For example, if you’re hiring for a position known for high turnover, you may not want to offer as competitive a salary as you would for an employee with many responsibilities who would be difficult to replace.

Compensate with benefits
If you can’t offer the same high salaries as other employers in your industry, consider making up the difference with benefits. Certain benefits like free parking may not cost you a whole lot, but could make a world of difference to an employee comparing your offer to another. Show employees and recruits how much their benefits are worth through a . Compensation reports clearly and concisely show how your benefits bridge the gap between your offer and the seemingly higher salary at another company.

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Category: Resources, Total Compensation

How Much Do Benefits Factor Into Decisions of New Employees?

The latest annual survey of employee benefits trends conducted by MetLife shows that employees are placing a higher value on benefits than ever before. This development appears to be a direct result of the recession.

The poll found that the economic downturn served as a wakeup call to employees, many of whom suddenly found themselves without insurance or retirement benefits. As a result, 41% of respondents said that they considered workplace benefits the foundation of their personal safety net, up from 33% in the months leading up to the recession.

Also, while factors like advancement opportunities and company culture were important to employees leading up to the recession, the study showed that insurance and retirement benefits have quickly become the most important factors in finding a job.

To attract and retain the best employees, then, it is important that you offer a strong benefits package. If you provide benefits like health insurance or a retirement plan, potential hires will feel better about working with you because they know they’ll be covered during an emergency. Many who were hurt during the recession are looking for assurance that they won’t be hurt again.

Learn more about how you can present an attractive benefits package to your employees.

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Category: Resources