Wage Comparison Exercise
Read the entire exercise (all questions) before beginning. More compensation information is available than ever before. Go to www.salary.com or any other on-line salary website. These sites provide pay data on hundreds of jobs in cities all over the United States in may different industries. Identify several (3) jobs of interest to you, including your own. Select specific cities or use the U.S. national average. Obtain the median, the 25th and 75th percentile base wage, and total cash compensation rates for each job and other relevant data necessary to address the following questions. Submit your responses to the following questions on line in Word format. Include the job descriptions (you may have to copy and past to a word document), pay ranges and other relevant information.
- List all of the jobs that you chose. Which jobs are paid more or less? (rank them) Is this what you would have expected? Why or why not?
- Do the jobs have different bonuses as a percentage of their total cash compensation package? What could explain these differences?
- Read the job descriptions. Are they accurate descriptions for jobs that you would be applying for or evaluating? Why or why not? Are there jobs for which you cannot find an appropriate match? Why would this be the case?
- Check out these jobs at either your company of those being advertised. Where did you find the jobs? How does the pay for jobs advertised either at your company or elsewhere differ from the pay levels on salary.com? Why do these differences exist?
- How could you/your employees use this information while negotiating salaries? What factors will influence the final salary level?
- What is the relevant labor market for these jobs? How big are the differences between salaries in different locations?
- For each job, compare the median salary to the low and high averages. How much variation exists? What factors might explain this variation in pay rates for the same job?
- Look for a description of how these salary data are developed. Do you think it provides enough information? Why or why not? Discuss some of the factors that might impair the accuracy of these data. What are the implications of using inaccurate salary data for individuals or companies?
- With this information available for free, why would you bother with consultant's surveys?
- If you were a manager, how would you justify paying one of your employees either higher or lower than the results shown on this Web site?