More than half of jobseekers say they have declined a job outright when the intended salary was revealed, according to a new study by software company Adzuna.
Survey respondents said salary transparency should be employers’ top priority on job postings—above the role itself, the location, company culture, diversity and inclusion policy (DEI) or any work benefits or perks.
Here’s why: on average, those jobseekers wasted seven hours applying for the job—only to end up with an unwelcome offer in the income department. While employees wish for greater information up front, employers argue for the ability to negotiate—protecting the competitive advantage inside of non-disclosure, while attempting to negotiate costs (instead of slotting into predetermined ranges).
Just 3% of job postings include salary, according to Adzuna. This puts the U.S. at the bottom of the pile when it comes to pay transparency—second to only India, Adzuna writes.
Right now, Washington, D.C., leads the nation with 19% of job ads showing salary levels, according to the survey. Colorado and Washington already have salary transparency laws on the books.
California Governor Gavin Newsom recently signed a similar law last month, which will go into effect in January 2023. New York Governor Kathy Hochul is mulling over the fate of S9427, the Empire State’s proposal for tackling pay disparities. At the bottom of the heap? Delaware, Wyoming, Oklahoma, Maine and Rhode Island—where job ads include salary details less than 1.5% of the time.
Wasted Time, Missed Opportunity for Salary Transparency
What’s behind the shift in wage warfare? Today, women earn 82 cents on the dollar, or 18% less than their male counterparts, according to the US Bureau of Labor Statistics. Jessica Ramey Stender, deputy legal director at Equal Rights Advocates, a sponsor of the salary bill in California, says, “Women, and especially women of color, are literally being robbed of wages every year. That is money that could go to rent, food, diapers, education, retirement savings.”
Senior attorney Seher Khawaja, who works at women’s advocacy firm Legal Momentum, says, “Salary disclosure makes employers more attractive and trustworthy to workers and helps bring in talent.”
When it comes to salary levels, without transparency, she adds, “You just really have no clue. Is it in the ballpark? You don’t know, and that just seems absurd.” Data shows that pay transparency could be the number one solution to closing the gender pay gap. But the solution isn’t that simple.
How Does Wage Transparency Hurt Employers?
The 2022 Pay Clarity Survey, conducted by WTW (NASDAQ:WTW), reveals that 17% of companies are already disclosing pay range information—even where not required by state or local laws. Nearly two-thirds of organizations report that they are considering disclosing pay rate information in the future. Perhaps as soon as they see the bottom-line benefits? Because removing or limiting negotiations around salary could be an expensive business proposition.
Thirty percent of organizations say that their pay programs are not ready for this kind of transparency, while another third say administrative complexity is a challenge. Meanwhile, nearly half of organizations cite possible employee reactions as a factor, and that’s why they are holding back on full disclosure.
Transparency, or Competitive Advantage: Blurred Lines
There’s no word on how the survey respondents feel about their corporate competition knowing what they are paying for a particular position. Or if your new boss or co-worker would really be OK with you knowing what’s on her W-2. Isn’t wage transparency sort of like looking at the opponent’s playbook, in the game of business? Won’t the competition know what it costs to steal your employees?
Transparency matters, but sometimes there are conversations that still happen behind closed doors. The recipe for Diet Coke isn’t on the internet—is that due to a lack of transparency? Or competitive advantage? For workers, and advocacy groups, the times they are a-changin’. But as the wheels turn, being able to negotiate and advocate for your interests remains a vital part of getting paid what you are worth.
Wage Warfare: A Battle That Employers Are Fighting - Here’s Why
Forbes senior contributor, Jack Kelly, sums up the pain points for forward-thinking organizations: “Businesses must be prepared for disgruntled workers. You’ll soon see people griping that they work harder and have better results than their co-worker who earn more than they do, and demand a raise. In-fighting and hurt feelings will ensue. There will be accusations of discrimination and potential lawsuits, asserting prejudice as the reason for being paid less than what other workers in the same role are being paid.”
Employees will be armed with new information—and perhaps new reasons to find another gig—when transparency is more prevalent. Just as the number of car websites has helped everyone at the car dealership to reduce their... Wait a second: car prices are up nearly 12% versus last year. Perhaps price is set by the marketplace, not public policy, greater transparency, or Carfax?
Wage transparency is another reason for workers to say “yes” to a particular employer. Or to reject an offer outright. In an economy with 1.7 jobs for every job seeker, transparency adds another layer of choice. Wage transparency is yet another source of information in the market, which may or may not result in its advocates’ intended consequences.
Colorado has had its transparency law on the books for over a year, and there’s been a 1.5% increase in labor force participation versus neighboring Utah. Statisticians might notice that this is a difference without a distinction, as it does not really explain if workers are actually better off, or if the law achieves the goal of narrowing racial and gender wage gaps.
Transparency favors the worker, especially those under-served or under-represented in the workforce. However, greater information can be both a solution and a problem at the same time - both characteristics co-existing within prevailing market conditions. As with any insight, it’s what you do with what you learn that impacts what you earn. What’s the ultimate effect of churn inside the workforce, griping inside the workplace, and elevated prices inside the marketplace? Only time will tell.
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October 21, 2022 at 04:00AM
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Jobseekers Reject Offers On The Spot When Pay Isn’t What They Expect - Forbes
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