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Pay transparency is a growing trend for job seekers, and it is expected to continue. According to Indeed’s Hiring Lab, 50% of online job listings in August included salary information, up from 18.4% in February 2020. This rise can be attributed to recent pay transparency laws enacted by states and municipalities. Additionally, the demand for workers during the post-pandemic economic reopening has given job seekers increased leverage, leading to more businesses disclosing salary information.
“With the growth of such pay transparency, the lingering norms and policies around pay secrecy have simply lost their teeth,” wrote Tomasz Obloj and Todd Zenger, professors at Indiana University and the University of Utah, respectively, in Harvard Business Review.
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Cory Stahle, an economist at Indeed, believes that pay transparency rates will continue to increase.
The statistics provided by Indeed do not include job ads that only list a maximum salary range, as the ambiguity of such listings can be misleading.
New York just adopted a pay transparency rule
New York recently became the latest state to pass a pay transparency law. Employers with at least four employees in the state are now required to disclose salary information in job postings.
This development follows similar legislation in California, Colorado, Washington state, and New York City.
The movement towards pay transparency is relatively new. Colorado was the first state to pass such a law in 2019, and it took effect on January 1, 2021.
Various cities and counties in New York, as well as Jersey City in New Jersey, have also implemented pay transparency laws, according to the National Conference of State Legislatures. Some states and municipalities, including Cincinnati and Toledo in Ohio, Maryland, Connecticut, Rhode Island, and Nevada, have taken a more flexible approach by allowing employers to disclose salary ranges upon request.
Websites like Glassdoor.com, Payscale.com, and Salary.com have also provided accessible information on employer pay.
Pros and cons of pay transparency
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Experts agree that greater salary information in job postings benefits both workers and businesses. It can help address pay gaps for women and people of color and level the playing field. Salary transparency also makes the application and hiring process smoother, as job seekers can easily filter and prioritize job opportunities.
It levels the playing field. At least they have a starting-off point.
Mandi Woodruff-Santos
career and money coach
According to a survey by Indeed, 75% of job seekers are more likely to apply for a job if the salary range is listed in the posting. Additionally, 56% are more likely to apply for a company, even if they are unfamiliar with the name, if the salary range is provided.
However, there are potential drawbacks to pay transparency. It may lead to lower overall wages for employees, although it can benefit those who are currently underpaid. Employers might also resist salary negotiations, reducing employees’ bargaining power. Pay transparency might also impact worker productivity and priorities.
‘There’s still plenty to negotiate’ beyond salary
Job applicants should remember that the salary or pay range listed on a job ad is not necessarily final. They can negotiate for higher compensation.
Aside from salary, there are other factors that can be negotiated. For example, remote work flexibility is highly valued by many workers and can be a valuable benefit. Workers should also consider other forms of compensation, such as signing bonuses, retirement benefits, professional development budgets, and wellness benefits.
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