While talking about compensation may still be largely taboo in the American workplace (and elsewhere), we’re seeing several trends that indicate pay transparency is on the rise.
First, many states now have pay transparency laws, including California, Colorado, New York, and Washington - and more states are likely to follow. These laws range from prohibiting employers from asking about a candidate's previous salary to requiring employers to provide pay ranges (either in job postings, or after the first interview, or if a candidate asks for it).
Second, there is social and economic momentum around pay transparency. Younger workers in particular are more likely to share their salary information, and websites like Glassdoor and Payscale make it easier to find this info on a bigger scale. Plus, the fight for racial and gender pay equity, the heart and catalyst of the pay transparency movement, is continuing to gain traction.
“Today’s workers are demanding more accountability and we’re likely going to see more states introduce pay transparency legislation in the coming years,” said Marisol Hughes, executive vice president of people operations and legal counsel, at WilsonHCG. “Companies that want to compete for top talent should pay attention.”
Right now, the vast majority of companies don’t think they have a pay equity problem. In fact, according to a recent study from XpertHR and Gapsquare, only 28% of employers believe pay inequity exists in their organizations. However, more than 80% had to adjust their pay after completing a pay equity audit.
Any company that wants to be competitive in hiring great talent (especially those that claim to support diversity, equity, inclusion and belonging) will need to put their money where their mouth is when it comes to pay transparency. The next generation of talent will not settle for anything less, particularly when you consider that 53% of women are pushing for it.
Third, more and more US job postings now include salary information. While those postings are still in the minority, it’s interesting to see which companies, industries, jobs, etc. are trending more toward pay transparency.
Let’s take a look at the data.
Pay transparency trends for the US
As we noted above, US job postings with no salary information still outnumber postings with salary information. But as you can see below, the ratio of new publicly posted jobs with salary data has increased from 27% to 36% over the last year.
One explanation for this trend could be that jobseekers are increasingly seeking job postings that include salary ranges. According to Glassdoor, salary is the top motivator for 67% of jobseekers. Plus, in today’s competitive market, including salary information can avoid wasting time and energy for both jobseekers and employers alike.
So, perhaps more companies are responding to these trends and are including salary information on their own accord. Or they could be responding to an increasing number of laws requiring companies to include a salary range in their job postings.
For example, New York City’s (NYC) new pay transparency law (enacted in January 2022) was originally supposed to go into effect in May 2022 but was delayed until November 1. So, many NYC companies could already be including salary ranges in anticipation of that new law. Colorado’s pay transparency law also requires employers to “include compensation in job postings” and that went into effect in January 2021.
In the chart below, we can see the top 10 metros with the most open jobs, ranked in descending order by the number of job postings with salary information. New York City and Denver are both among the top 10, and the effect of Colorado’s pay transparency law is quite apparent with the number of job postings with salary outnumbering postings without salary.
In addition to metros, it’s also interesting to look at pay transparency among the nation’s most in-demand job titles. In the graphic below, we can see how some jobs like sales associate, assistant manager, team member and retail sales associate still lag behind others in terms of pay transparency. Meanwhile, job postings for delivery drivers seem to be ahead of the curve and maintenance technicians are not far behind.
Pay transparency trends by industry
To compare pay transparency trends between industries, we looked at the 10 biggest industries in the US and chose four very different ones to examine more closely: banking, education, pharmaceuticals and automotive.
Banking and pharma have both seen minimal increases in pay transparency over the last year. The ratio of publicly posted banking jobs with salary data has increased from 13% to 19%, while the ratio of pharma jobs with salary data has increased from 15% to 24%.
The gap between jobs with salary information and those without is especially glaring over the last few months for both the banking and pharma industries.
The education and automotive industries are both showing more positive pay transparency trends, especially education. Over the last year, the ratio of publicly posted education jobs with salary data has increased from 34% to 39%, while the ratio of automotive jobs with salary data has increased from 26% to 34%.
Top 10 companies for pay transparency
Now let’s take a look at pay transparency on a company-by-company basis. We looked at our job posting data and pulled out the top 10 companies with the highest number of job postings with salary information.
State Farm Insurance
United States Postal Service
Recruiting From Scratch
With increasing momentum on the legal and social sides of the issue, coupled with a competitive hiring market, pay transparency will soon become an even bigger player in the American economy. Companies that get ahead of it will likely see more success in hiring, pay equity, brand affinity and more.