What is advertised salary?
Simply put, advertised salary is the salary information provided by a company or entity advertising for a position.
Unlike most compensation sources (surveys, OES, etc.) that are usually 12 months behind the times, advertised salaries are recorded in real time. This up-to-date data lets users view labor market trends that can be crucial to identifying wage pressures for a role or industry.
Advertised salary can be used to understand unique variances of advertised compensation by job title, company, region, and even skill sets. It is not necessarily the actual salary the employee receives—only the salary as advertised.
Real-time wage data—your new personal detective
Regardless of the exact price point, advertised salary can show you how the competitive wage for a job is rising, falling, or stagnating.
So you get an accurate, real-time pulse on the state of the market without the investigative leg work. Say hello to a new found confidence in the compensation rates advertised in your job postings.
Let’s talk a little more about the state of the labor market…
A common misconception people have about the labor market is that because we are currently experiencing high unemployment, there should be plenty of talent to fill jobs and this influx in available talent should drive compensation down.
The truth is, most companies are feeling the opposite. Finding talent is harder than ever because demand is high and supply is actually really low.
You can read more about wage inflation and America’s low supply of workers here!
An Emsi customer recently noted,
“Labor market participation has dropped, meaning the available talent pool is shrinking as demand is growing. Using Emsi data we have also discovered that remote opportunities are up 4x from 2019 to 2020. This number will likely continue to increase in 2021, meaning increased competition for talent that many of our clients are not used to. In short, we are seeing an increased demand and a smaller talent pool which is driving compensation up.” – Recruiting Leader at a Global Talent Services company
The table below shows occupations that have seen a huge increase in advertised wages over the last year due to high demand and low talent supply.
Notice that occupations like Postal Service Mail Sorters and Packers/Packagers have experienced an increase in advertised wages as a result of a surge in online shopping. Loan officers have also experienced an increase in wages as Americans rush to refinance their homes and take advantage of low interest rates.
These insights wouldn’t be available if we solely relied on government reported wages (which have a 12+ month reporting delay).
Advertised salaries allow for real-time competitor analysis
Companies like Amazon that can afford to pay a higher wage for entry-level positions are more likely to advertise higher wages on a job posting. Those competitive advertised wages bring the overall advertised wage up.
When Amazon enters a market sourcing a city for talent, a ripple effect occurs. Let’s look at their recent effort to recruit talent in Detroit, Michigan.
The tech giant thrived as a result of the online shopping boom. More online orders meant more demand for manufacturing to produce items, warehousing to pack and ship those items, and for trucking to deliver items (in the all-so-coveted 2-day shipping guarantee).
Forklift Operators became one of several occupations in high demand as a result of the boom. The average wage for Forklift Operators in Detroit during 2020 was holding steady at $14.00/hr until Amazon publicly announced an initiative to hire 2,000 workers in Detroit at $15 dollars/hr.
While this announcement came in September, we can tap into advertised salary data to see that Amazon actually started advertising a $15.00/hr wage in their job postings starting in August.
That’s a 7% increase in one month because of ONE company!
Other organizations trying to hire talent faced a major squeeze as Amazon entered the market and out-priced their wages.
The announcement forced other companies with Forklift Operators to follow suit with a $15.00/hr wage and the advertised pay has not dropped since. It would seem that Amazon has set the new standard for Forklift Operator pay.
If smaller, competing companies had advertised wage data, they could’ve tracked this trend early and made a strategic plan right away. Data like this helps you call the shots and get ahead of the competition.
What can we learn?
In some cases, advertised wages are specifically used to attract talent
The inflated pay rate we’re seeing now for positions like retail sales, truck drivers, or travel nurses may even stick around. Wages for independent contractors usually range above the actual government-recorded wages as well.
Remember, advertised wages are a great representation of trends in the market and do not represent the salary for every role.
They are however great for keeping an eye on the trends of the labor market. With remote work on the rise and increased opportunities for your talent to work from home for the bigger companies like Amazon or Google, keeping an eye on your talent is crucial.