Survey reveals that employers know they must increase compensation but struggle to do so affordably
New York City (July 14, 2022) – According to the XpertHR Compensation Practices Survey 2022, employers believe that better employee compensation is the key to retaining and attracting talent—though making the necessary adjustments on that front presents its own financial challenges. Nearly eight in 10 (78%) of employers rated offering competitive pay as a “high” priority for attracting talent this year, but 88% said that doing so will be “somewhat” or “very” challenging.
Image caption: Keeping pay competitive, ensuring pay equity and balancing retention with affordability are the top priorities of employers in 2022 [left]—yet, at the same time, employers find these same goals are their top compensation challenges [right].
“The extremely tight labor market is forcing employers to reevaluate their pay structures,” says Natasha Wiebusch, Legal Editor at XpertHR. “Yet many companies struggle to free up the financial resources to do this.”
With the cost of living rising in the current economy, staying competitive with compensation is all the more challenging. Eighty-four percent of the survey respondents said that balancing retention with affordability is also “somewhat” or “very” challenging, while 67% cite inflation and cost-of-living factors among the top three challenges.
“Employers are scrambling to remain competitive with compensation while not breaking the bank,” Wiebusch added. “But the results are clear: employers who want to retain or grow their current workforce must be prepared to spend more on labor.”
Among the bright spots of the compensation survey, however, was the fact that 68% of participating organizations designated pay equity as a high priority this year. The growing effort to improve workforce representation and pay equity was among the top five diversity, equity and inclusion trends XpertHR identified for 2022.
The XpertHR Compensation Practices Survey 2022 was conducted from April 5, 2022, to April 29, 2022, using a self-administered online survey. The survey sample includes 314 employers that are located across the US. The total estimated number of employees of the responding organizations is 536,242. This survey report explores compensation practices, such as what types of pay structures are used, priorities and challenges of compensation structures, common benchmarking practices, and more. A complimentary press version of the report is available upon request.
XpertHR has been providing HR solutions since 2002, empowering organizations across the globe to build successful workforces and create a purposeful workplace for all. The platform delivers expert insight, trusted resources, data analysis and practical tools to help achieve greater efficiency, reduce risk, and increase employee engagement. XpertHR is developing smarter data analysis tools and cutting-edge technology to support future demands on HR in an increasingly digital world. To learn more, visit xperthr.com.