Starting your own business is one thing; growing your capacity to bring other people on board is a whole other! When you introduce new employees to your home-grown team, you’ll want to make sure you’re paying them well. But it can be tough to know how to determine salary for a position.
Use these 5 tips to make sure your future employees will be happy and fulfilled.
1. Be Realistic With Your Budget
There’s no use in hiring new employees if you can’t afford to pay them. Knowing exactly how much you can afford to spend on human resources is a crucial first step in the hiring process. Before you can expand your organization, you need to be certain you have the capacity.
2. Know Your Roles
What is the real value of the role for which you’re hiring? What day-to-day expectations and responsibilities will the role entail? Understanding the ins and outs of the role can help you assess a fair price point. Take a few minutes to write a job description detailing everything you’re going to have the person do. Then reflect on the requirements and move into the research phase.
3. Do Your Research
There are a lot of factors to consider when it comes to salary. First, consider the position you’re hiring for. Is it typically an hourly position or are salaries for similar roles fixed? Looking up the average business salaries for roles that resemble the one you’re offering is a must. This will give you a sense of how much your applicants will be expecting.
4. Start With Entry-Level
When determining pay scale, consider starting an employee off at baseline pay. This way, their salary can grow alongside your company. As your business expands its profit capacity, your employees can improve their skills and earn more.
You may only be able to afford entry-level employees at the start. This is completely fine! Just be sure you can appropriately compensate them for annual bonuses and promotions.
5. Hire a Professional
If so, you may need to bring on someone who specializes in payroll services. This is a helpful tip for companies that have a few employees on board already and can afford to bring on a full or part-time payroll specialist.
But maybe your company isn’t ready for that yet. Or maybe you find issues of payroll and working out the numbers frustrating. If that sounds more like you, then you can always book a consultation with a company that specializes in payroll and accounting.
How to Determine Salary for a Position
With these 5 tips in mind, you’ll be ready to hire your next employee in no time. Don’t be afraid to get in the weeds with payroll best-practices. Knowing how to determine salary for a position in your company is a skill that will serve you well. As your business continues to grow, you will need to know the ins and outs of salary setting.
If you’re interested in learning more about running your own business, check out our resources page.