Indeed recently introduced pay estimates on most job postings and is working with employers to encourage including salary information when they post a job. The move benefits everyone. Here’s why.
What is pay transparency? At the most literal level, it’s when companies provide information about how they compensate their roles. That might mean posting pay ranges in job listings or being open about how current employees are paid.
But, of course, it’s about so much more than that.
Transparency is an opportunity. For job seekers to become empowered during the application and negotiation processes. For employees to understand how they can thrive within an organization, and feel seen and fairly compensated. And for companies to streamline hiring practices, strengthen HR leadership and make real changes — changes that have ripple effects for their employer brand and employee happiness.
Transparency is a philosophy. A choice to be accountable and human-centric, to encourage open conversations about money and work.
And transparency is, above all else, a bold move toward pay equity — it’s the right thing, right now, and we’re confident our partners feel the same.
Women in the United States still earn about 82 cents for every dollar earned by men. That gap is even wider for Black women and those in marginalized communities. The policy of pay transparency allows job seekers and employees to better advocate for themselves, and it can begin to close the gender and race pay gaps as part of wider diversity, inclusion and belonging efforts.
Starting in 2023, employers in Washington state with 15 or more employees will need to include compensation range and benefit information in their job postings. Colorado already requires this information, and New York City will oblige companies with four or more employees to disclose it starting in November. Meanwhile, a number of other states (California, Connecticut, Maryland, Nevada and Rhode Island) require sharing compensation information at various points in the application or interview process. The European Union is working on similar legislation.
Since 2018, Indeed has moved toward pay transparency by posting pay ranges for all of our own openings at the company. This year, we took it even further and will now be emphasizing pay transparency more broadly. Our goal, ultimately, is to include accurate compensation information for all jobs posted on Indeed. So how will we get this information?
The best way, of course, is to get it directly from employers. If you provide a salary range for a job post, we’ll let people know the data is straight from you — and that matters because job seekers value transparency. When employers do not offer this information, we will calculate our own estimated salary for each job posting based on the data we have available. Indeed already uses a combination of employer– and job seeker–provided salary information from Indeed and Glassdoor, as well as job title, location, education requirements and other job features, to estimate pay for roles. Until now, these figures have not been included in job postings. Moving forward, if we’re confident our estimate is accurate, we will include it in the post.
“Compensation information is, unsurprisingly, one of the top factors when considering a job,” says Brendan Sterne, group vice president and general manager for the job seeker at Indeed. According to an Indeed survey, 75 percent of respondents say they’re more likely to apply for a job if the salary range is listed in the job posting.
Is pay transparency a good thing? At Indeed, we’re confident the answer is yes. “Job seekers and employers can align on salary expectations, and transparency can help eliminate pay inequities,” Sterne says.
If pay transparency is implemented successfully, employees will learn they make a fair wage, and know their employer values inclusion.
But note that wording — if implemented successfully. No one solution will work for every company, and, what’s more, pay transparency is a complicated HR effort that requires a solid strategy. Talking about money can be complicated and personal, but overcoming those barriers is important. How can company leaders be transparent about pay in a way that benefits job seekers and their own organizations as well?
To answer that question — and do what’s right for job seekers and ultimately good for employers — we’re kicking off a special series of articles designed to help human resources and talent acquisition leaders prepare for this complex but ultimately rewarding shift in how to approach a once taboo topic. After all, the future of work in this new hybrid world will require companies large and small to be more interactive and trusting with their employees. Pay transparency is one aspect of that.
The first article in our series is a case study that shows how one business tackled pay transparency in response to state legislation. The second will cover new, unique data insights from Indeed surveys of hiring decision makers, as well as HR and talent attraction leaders on the frontlines of salary transparency efforts. Finally, a third piece tackles common myths about pay transparency and explains how companies can approach it as an opportunity for real, lasting and positive change. With this series, we will offer strategies and tactics for navigating a novel terrain for which there is currently little guidance.
“Indeed is founded upon putting job seekers first,” Sterne says. “I’m confident these industry changes will help job seekers match with jobs that align with their salary expectations — which is also good for employers.”