MRA survey: 66% of companies are adjusting established pay ranges or starting rates

Organizations and companies are adjusting both pay ranges and starting rates to keep up with the market according to the latest MRA survey. Hourly positions have experienced the most change, with 41% indicating they have increased established pay ranges.

“While employers are having to become more creative and much more competitive to fill positions, it is also creating pay compression within organizations,” said Zach Day, MRA Director, Surveys, Custom Research & Analytics in a release. “Increased wages and pay compression can become a risk for companies when it comes to employee retention. Not only do we now have companies looking at how to best fill positions with talented candidates, but they also need to be careful to retain the talent they currently have. It creates an exceedingly difficult balancing situation.”

The survey showed that currently, 40% of companies have made internal adjustments because of changing pay ranges and 29% are in the process of reviewing internal equity, with 20% not experiencing pay compression.

In addition, companies are looking at other pre-employment and hiring practices including changing their pre-screening processes. Forty-three percent have made changes to expedite hiring, while 50% are keeping standard practices in place. Of the changes being made to the pre-screening process in the past two years, 21% have changed or removed criteria for background checks (criminal, credit, education, references, etc.)

Pre-employment drug screening is another area that companies are reconsidering. Marijuana and THC have been a common point of discussion for drug screening practices. With more state legalization occurring throughout the country, MRA’s survey asked if THC or marijuana is included in their company’s pre-employment drug screening. Responses show 34% do not include it, 14% currently do but are considering removing it, and 48% still do. The majority (52%) who are considering removing THC/marijuana from their drug panel would do so to reduce the number of ineligible candidates, 28% to expedite the hiring process, and 19% because it is legal in their state. However, 69% do include THC/marijuana in their post-accident drug screens according to the survey.

Cherrie Spurlin, MRA’s Executive Director, Western Illinois & Iowa, “Understanding the organization’s turnover rate compared to the market and paired with other human resource metrics allows leaders to identify issues with their company’s culture. With the high rate of turnover, retention is critical.”

408 organizations participated in the 10-question survey which was conducted March 14-21, 2022. To see the full survey results visit the MRA website.