Pay perception may be more important to workers than actual compensation
- A new study from PayScale showed that how employees feel about their organization's approach to pay fairness and transparency had a higher impact on their job satisfaction than the amount they were paid. PayScale surveyed 501,796 workers on which aspects of their job contribute to their satisfaction and retention, and ultimately to their engagement.
- The research also found that, of the respondents who felt they were underpaid, 90% actually were paid at or above the market rate, and 75% of respondents who think they're paid on or above the market rate are satisfied with their jobs. Appreciation raised the satisfaction meter higher than any other factor. Also, employees who felt their company was on the rise planned to stay in their job, a factor that even edged out appreciation in terms of boosting retention.
- Variables in the research that were half as important as appreciation were communication (53%), pay process (49%) and development (48%).
The biggest surprise coming out of the PayScale study was the importance employees placed on their organization's rise and its effect on their retention. This result suggests that workers highly value being connected to a successful company. The challenge for employers is to make employee engagement the highest of priorities, because worker satisfaction is a big driver of organizational success.
Employees in many survey results appear less concerned about their pay levels than feeling appreciated and having development opportunities. But that doesn't mean they don't care about the details of how they're compensated. U.S. employees, in particular, have a great deal of complexity surrounding their pay. Employers can act ethically by being transparent with workers about how wage levels are set and whether they're competitive. Workers shouldn't be in the dark about whether they're adequately paid.
PayScale's call-out of appreciation is important for direct managers. Simply taking the time to say "thank you" can do wonders for workplace culture, and recognition of good efforts in front of larger groups — termed social recognition — remains one of the most powerful ways to show that appreciation, according to researchers.
- Nasdaq GlobeNewswire New PayScale Study Reveals Employees’ Perceptions About Pay Fairness and Transparency are Five Times More Impactful on Engagement Than Actual Compensation
- HR Dive https://www.hrdive.com/news/employees-feel-valued-when-they-can-access-pay-benefits-info-online/505690/
- HR Dive How to build a culture of thanks in today's workplace