How much should I pay?

How much should I pay?

As a recruitment expert, your remit is to find a bright candidate with desirable skills for your client or your company. That’s a tough enough call, you will agree. However, once you’ve got your dream contender, things can get even more complex. One the one hand, you need to make absolutely sure you don’t scare them off with a derisory pay package, but on the other you don’t want to blow the budget.

The decision on what to pay a candidate is often a joint effort between the consultant and the company, as Ben Kershaw, managing director at Manchester-based Benjamin James Consultancy, points out. “About 95% of the time the client will set the salary and we will advise on market trends if they are off,” he says. “Likewise, we would always negotiate if we were likely to lose a candidate.”

And it’s this possibility of losing a candidate that proves setting a salary is never an exact science. It’s a no-brainer that the remuneration you offer has a dramatic effect on whether a candidate takes the job. If you set it too high they will enthusiastically accept more money than the job is worth. If you don’t offer enough and refuse to negotiate, they may head into the welcoming arms of your competitor.

So, how do you go about negotiating the right salary? Clearly, different job roles and industries demand different salary levels, but our research has thrown up a few methods that can help anyone to set a fair remuneration package.


Rule one: Be prepared to negotiate

The scenario: You’ve offered your candidate a top managerial role, but they rejected the salary package. You now have to weigh the risk of not increasing the offer with having to continue your job search, and potentially losing a dream employee.

How to seal the deal: If you feel that in the long-term they would be a great asset to your business, you could simply offer them more money. If you choose to do this, you might want to add the proviso that they have to follow a defined progression in the company. That way, the onus is on them to prove their worth and you get a good return on your salary investment.

If your budget rules out a cash increase, you could make the offer more tempting by boosting the package to include more employee benefits, such as training courses, flexible working, extra paid holiday, retirement, healthcare and commuting subsidies. Some employees will take a lower annual salary if there are great benefits that go with the job.

The more senior or specialist the role, the more you might need to negotiate the salary package to snare the candidate. Bear in mind that if your ideal candidate is already working for a similar company, you’ll probably have to offer them a higher salary or better package to lure them away.


Rule two: Be flexible in evaluating skills and experience

The scenario: You’re recruiting a specialist consultant and have just found a candidate with a wealth of experience. The salary is going to be £50,000 a year, but you know they are already earning that in their current job and you don’t want to lose them.

How to seal the deal: Assess how much experience your candidate has and what added value they could bring to the company. You may need to offer a more skilled candidate a higher salary even if they share the same job description as others in the team.

First, consider also how many years experience they have. This is an important factor in determining salary because it could indicate how much value the person will bring to your company in both the short- and long-term. For instance, they may need less investment in training and supervision, and have more initiative.

If relevant, look at their level of education. In some professions this is almost as important as their years of experience. People with relevant advanced degrees usually bring a high level of understanding and knowledge to the job and can command high salaries in the marketplace.

Try some gentle negotiation to find out what the candidate will accept. Start with an offer that is a bit lower than you are willing to pay and have a cut-off point if they counter with something higher.

Whenever you replace a team member, beware of simply offering your candidate the same salary as the previous incumbent, the salary might be the reason why the last employee left. You need to assess whether the job responsibilities have evolved and do a salary review for the role.


Rule three: Assess regional variations

To find out what you should be paying, examine the regional average salaries for relevant posts. In addition, check out the cost of living in the catchment area where you are recruiting by logging on to the local government website. Housing prices, transport, schooling and food costs will all affect the salary you should be offering.

Even in low-grade jobs you need to ensure that workers can make a living wage.


Rule 4: Use salary ranges

The scenario: Your job ad quotes a salary range of £20k-£26k for the post of IT support executive and now you’re ready to offer the job to a candidate. But how do you decide whether to offer them the job at the top or the bottom of the salary scale?

How to seal the deal: For some posts, publishing a salary range makes sense because if you advertise too low a salary you will inevitably attract a low number of quality responses.

But don’t be tempted to set too broad a salary range in an attempt to attract a selection of good applicants and then make an offer at the lowest level. If the candidate rejects your offer, you’ll have to start the expensive and time-consuming recruitment process again.

Even worse, the candidate might accept your low offer, take up the job feeling demotivated and then quit within a short time. This doesn’t reflect well on any recruitment consultant or HR manager.

At the other extreme, if you offer a salary that tips the pay scales of existing employees in a similar role it could lead to serious resentment and even legal action on the basis of discrimination.

The solution is to do your homework. Find out what the pay scale is for comparable roles at similar-sized firms and having established the industry average for the vacancy, set a salary range around that amount.

Another handy tip is to work out which qualifications or skills a candidate would need for you to offer the highest pay level and which skills you could live without to offer a lower salary. also offers a salary calculator that enables you to view the salary for any job or industry within any location in the UK. Just enter your job keyword and location, and we’ll show you the average wage plus the highest and lowest salaries for that position based on recent job ads.


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