I got a really great question recently about wage competition. This organization that the question comes from has done a great deal of research on wages for their positions and has a defined wage structure that is usually competitive with the market. However in this situation, one of their competitors decided to offer a position at a wage much higher than what is typical for that position. So frustrating!! So what to do?
Here are some ideas. . .
Do you have a deadline for hiring into the position? If possible consider delaying recruitment until your competitor has finished their recruitment.
Do you feel the job description, responsibilities and requirements are the same as your position? If not, this could have some bearing on why the position is being offered at such a high rate.
If yes, consider adjusting the wage for your position. If you are considering this, take into account how this would affect the entire wage structure and your existing employees before making a change.
If that isn't affordable, then we recognize that we are offering a lower rate than some other organizations. This means that we will have some attrition from our positions into those higher paying jobs, but we should remember there are only so many of those jobs available. There are a few ways that organizations differentiate themselves in the competitive wage market to keep people when they are in this position:
1. Your vision - the unique vision that your organization has and how you are realizing it in the world. This vision will call to people who really want to make that vision a reality, and would be willing to work for less money to be affiliated with your organization.
2. Your culture - the combination of personal relationships, opportunities for training and development, and day to day life that your organization bring to your employees. A reputation of having strong mentors, teamwork, and a feeling of belonging go a long way toward attracting and keeping people.
3. Benefits - Flex time, work from home, company celebrations (picnics, trips), special training & development opportunities, cross training / job shadowing, social capital, sustainable commute incentive, holidays
4. Work load - Making sure that employees have a manageable workload and are able to eliminate or manage stress
5. Strong Pipeline - Building a strong internal and external pipeline for positions with higher turnover. This means that you train people in entry level positions to take on higher level positions and you build relationships with people outside your organization so that you can reach out to them when you have a position to fill.
To learn more about compensation and how to create a more competitive compensation package check out the HR Building Block: Internal Economy.