Executive Compensation: How to Set a Realistic Salary Range
On the face of it, setting a salary range for an executive position should be straightforward. After all, we’re just talking about numbers, right?
Scratch the surface, however, and salary range is so closely tied to successfully attracting and retaining top executive talent that we can stress enough the value in really thinking it through.
Here at ACCUR Recruiting Services we have lots of experience of evaluating multiple variable to give our clients a quick read on the competitive landscape. This we feel is key for a strategic approach to the hiring process. And while a salary range is ultimately a set of numbers, it’s derived at by a set of factors that have a huge degree of influence on the types of candidates you will attract in the executive search process.
Why it’s so important to get it right
The salary range you set for a position determines the following:
- How many qualified candidates you can expect to get
- The quality of applicants
Your company’s hiring philosophy
Part of determining your strategy for hiring an executive depends on how you view your competitors, that is, the organizations that are likely already employing your dream candidate. Your offer will either be comparable, ahead or behind of the market rate for the position. Normally the companies we work with want their offers to be competitive, especially in the current market, and determining how competitive your offer is has a lot to do with how much you are willing to research the market.
The local market
At ACCUR Recruiting Services, we are often consulted when a European company is expanding operations in the United States or other region. We help firms navigate cultural and economic differences in order to find candidates who can deliver the business objectives they need. Our clients are often surprised at how much variance there is on the cultural level. A knowledge of the local market is therefore essential in setting the right expectation in salary.
A competitive job landscape
The past couple of years have proven to be an extremely tight job market. The US unemployment rate has hit historic lows in the past two years, standing at 3.6 percent in May 2019. With a surplus of job openings and a shortage of candidates, executive talent can afford to be choosy. What does that mean for you?
Do your research
What is the best way to know what kind of salary you should be offering? Look at sites such as Salary.com or Indeed.com to get a feel for comparable salaries for the position you are seeking candidates for.
How we help
At ACCUR Recruiting Services, we frequently consult on how to set a strategic salary range. To do this, we use our years of knowledge of the executive placement market, along with a network of individuals knowledgeable about the local market. We know that this process is challenging and that’s why we’ve developed a FREE assessment. Take it now for customized guidance on setting the right range for your position.
