In this guide, we list the best compensation benchmarking tools. Compare features of the top tools for salary research and analysis.
As the job market continues to evolve, the cost of living, salaries, and benefits are all rising globally. This quick evolution presents a difficult challenge for hiring managers and HR reps who want to keep up with their local market and what competitors offer new employees. That’s where salary compensation benchmarking tools can help.
SEE: New employee checklist and default access policy (TechRepublic Premium)
By providing up-to-date data on salary averages for different industries and even specific positions, compensation benchmarking tools can help HR teams compare their salary offers to the market rate to ensure they offer competitive wages. In this guide, learn about some of the best compensation benchmarking tools available today and how they can help your recruitment and hiring efforts.
A key part of finding the right candidate for any role is offering an attractive salary that works for both the company and the candidate. The best compensation benchmarking tools can help you and your candidates agree on salary expectations.
SEE: Find high-paying cybersecurity and IT support jobs in these U.S. cities
These tools provide data on salaries in your area, considering factors such as experience, cost of living, and benefits. You can then adjust the salaries you offer according to your own needs and business goals.
With that knowledge in mind, here are some of the best compensation benchmarking tools:
| Tools | Employer dashboard | Salary-comparison report downloads | Benefits information | Free to use |
|---|---|---|---|---|
| Indeed | Yes | No | Yes | Yes |
| Salary.com | Yes | Yes | Yes | Limited |
| Payscale | Yes | Yes | Yes (paid version) | Limited |
| Bureau of Labor Statistics (BLS) | No | Yes | Yes | Yes |
| SalaryExpert | Yes | Yes | Yes | Limited |
Indeed is an online job search engine that allows job seekers to search for jobs posted by employers, create résumés, and apply for jobs. It also provides employers with a platform to post job openings and manage recruitment.
In addition, Indeed provides a compensation benchmarking tool that allows employers to view detailed salary insights for informed compensation decisions. With Indeed Salary, employers can compare salaries for specific job roles, locations, and company sizes to see how their compensation stacks up to the competition.
The tool allows employers to see how their compensation compares to industry averages and national and local salary trends. Job seekers can use it to understand what salary they can expect in a certain market or job type.
| Pros | Cons |
|---|---|
| Mobile app available for on-the-go access. | No information provided on potential bonuses. |
| Detailed salary comparisons between different roles in the same industry. | Data filters can be improved. |
| Updated regularly with new data and job market trends. | |
| Free to use. |
The compensation benchmarking tool is free to use and provides a detailed look at salary data for job seekers and employers.
Visit Indeed
Salary.com is an online resource for salary information and surveys that help employers, employees and job seekers make informed salary decisions. It features salary data from employers, compensation research from Salary.com’s internal database, job listings, career advice, and other resources.
Salary.com is an interactive and comprehensive resource for pay data from hundreds of thousands of organizations across the U.S. It allows employers to compare their compensation data against industry and geographic benchmarks.
With Salary.com, employers can access salary surveys, job descriptions, and other data to ensure they offer competitive wages and benefits.
| Pros | Cons |
|---|---|
| Access to a comprehensive database of job titles, salaries, benefits and other compensation information. | The cost of using advanced Salary.com features can get expensive. |
| Salary database is updated regularly. | User interface is not super friendly. |
| Reporting and analysis of up-to-date market data. |
If you are interested in the full version of Salary.com’s CompAnalyst Market Data tool, speak with Salary.com directly for pricing information. A 14-day free trial is available.
Visit Salary.com
Payscale is an AI-powered compensation tool that helps employers and job seekers make informed decisions about salaries. It offers access to salary data on millions of job titles across hundreds of industries, including U.S. and international markets. It also analyzes job titles, pay trends, and salary data for specific locations.
With its reports, employers can compare their pay structure to industry averages and adjust as needed. Job seekers can use the data to inform their salary negotiations and compare potential salaries for different job titles. Payscale also includes salary surveys, cost-of-living calculators, job descriptions, and employer-specific salary data.
| Pros | Cons |
|---|---|
| Compensation scenario builder. | Steep learning curve. |
| Custom user profiles based on current job role. | |
| Comprehensive database of reported data from over 65 million employees. |
Visit Payscale
The Bureau of Labor Statistics (BLS) is a government agency within the U.S. Department of Labor. It collects, analyzes, and disseminates labor-related statistical data to the public.
The BLS manages data on various topics, including employment trends, wages and benefits, inflation, productivity, and workplace safety. It produces reports on special topics such as occupational injuries, job openings and separations, and labor force participation.
| Pros | Cons |
|---|---|
| Robust data filters. | Interface could be modernized. |
| Downloadable reports. | Steep learning curve. |
| Comprehensive database. |
This tool is free to use with no limits.
Visit BLS
SalaryExpert is a salary and compensation data platform that provides salary reports, cost-of-living comparisons, and salary survey data. It provides a comprehensive resource for employers and job seekers to compare salaries and plan their career paths.
The tool offers users salary analysis tools, industry trends, and job market insights. SalaryExpert allows users to access salary data for various jobs and locations and compare salaries among different industries and regions.
| Pros | Cons |
|---|---|
| Gathers data from three sources. | Cost of living data for cities outside the U.S. is limited. |
| Conducts advanced analytics. | |
| Provides data for executive pay. |
This is a quote-based tool. Potential buyers should contact the provider for a custom price.
Visit SalaryExpert
Compensation benchmarking tools are software applications that enable employers to compare their compensation practices with those of other organizations in their industry or geographic area. Combined with HR analytics software, benchmarking tools can be used to identify areas of opportunity and to develop a comprehensive, data-driven compensation strategy.
SEE: What does ‘data-driven’ really mean? (TechRepublic)
Salary benchmarking tools provide a comprehensive view of the market, allowing employers to assess their competitiveness and decide how best to attract and retain top talent. They typically include salary and bonus information, benefits packages, pay structures, job descriptions, and other factors. These tools can be used to identify compensation trends, assess the current market, and develop strategies to remain competitive.
Compensation benchmarking tools can provide data to help organizations identify areas where they need to invest more to attract top talent. This data can inform decisions about how to structure compensation packages to recruit quality employees.
Compensation benchmarking tools can be used to develop competitive pay practices, ensuring an organization’s salaries remain competitive and attractive to current and potential employees. Organizations can develop competitive salaries and benefits structures by utilizing compensation benchmarking tools to retain their top talent.
Employees are more likely to feel satisfied and motivated when they believe they receive competitive wages and benefits. Compensation benchmarking tools can be used to identify and correct any pay disparities. They also offer a level of salary transparency that a growing segment of employees and job seekers want to see from employers.
These tools enable organizations to create and maintain transparent and equitable compensation structures by providing a clear view of the external market for each job. This can reduce pay inequities and ensure employees are compensated fairly. Further, pay transparency often builds trust between employees and management, improving overall morale and productivity.
Compensation benchmarking tools can identify and address any pay disparities within an organization, helping to ensure all employees are fairly compensated regardless of gender, race, or other protected characteristics.
Compensation benchmarking tools can help organizations confirm their pay practices comply with applicable government regulations. This can help employers avoid costly penalties or fines that might be imposed for non-compliance.
Job market, role requirements, and job seeker expectations continue evolving, particularly in fast-moving B2B and B2C technology industries. If your HR team is having trouble keeping up with all of these changes, compensation benchmarking tools can supplement their work with your industry’s most recent data on salaries. Knowing the average salary for a given role can help you adjust your offer to remain competitive.
It is customary to perform a performance review with employees at least once a year; a salary review is often part of it. However, benchmarking more frequently is beneficial in a turbulent economy and can help companies stay competitive when attracting and retaining talent.
Not all roles need benchmarking regularly, but if a role has high employee turnover or is difficult to fill, it may be worth revisiting the salary. Exit interviews and candidate feedback can help identify if the salary is a barrier. Ensure the data used is up-to-date, legitimate, covers different skillsets and experience levels, and that it aligns with the business.
Read next: The best applicant tracking systems (TechRepublic)
Fiona Jackson is a news writer who started her journalism career at SWNS press agency, later working at MailOnline, an advertising agency, and TechnologyAdvice. Her work spans human interest and consumer tech reporting, appearing in prominent media outlets such as TechHQ, The Independent, Daily Mail, and The Sun.
