Salary Benchmarking and beyond

According to a recent survey, over a quarter of workers plan to move roles in the next 6 months. With the average cost of employee turnover sitting at over £30,000, benchmarking can help your organisation improve retention and minimise employee turnover costs.


Retention. Retention. Retention.

How can you ensure that your employees aren't just happy but also want to stay and grow with your organisation?

We’re big believers in a holistic approach to talent management. If you can’t retain staff, no amount of acquisition will ensure long-term success.

While employees are swaying towards stability amid economic uncertainty, the number of employees planning to move roles remains historically high. Meanwhile, increased demands for transparency from candidates and through regulatory measures are making it ever more critical that businesses assess the competitiveness of their offer.

A 2023 Randstad survey found that 26% of employees plan to switch jobs in the next 6 months, down from 41% in 2022 during the peak of what was dubbed ‘The Great Resignation’. The 2023 Retention Report by the Work Institute provides a view of the US economy and reports over fifty million voluntary departures in 2022. In context, this meant a third of the US workforce changed jobs in that year.  Around 15% of workers still fear losing their jobs, a number which is consistent year on year, suggesting the factors influencing switching roles lie elsewhere.

26 percent of employees plan to switch jobs in the next 6 months

The two biggest attraction factors continue to be work-life balance and remuneration, with career progression in third. It’s no surprise that the youngest demographic is most open to changing their role, with those later in their career more likely to prefer stability. 

Research by Oxford Economics and Unum shows that the average cost of employee turnover is £30,614, which can substantially increase if you hire and train for a specialist role in your organisation. This means if you were to lose four employees in a year, it would ultimately cost the business over £120,000 to replace lost staff and bring those new to the role up to speed.

So, what can you do to combat this? How can you attract and retain employees who want to stay and grow with your organisation? With 35% of staff leaving organisations within their first year, a retention strategy is vital.


There are several ways to approach this, including by ensuring you have a robust wellness programme and are ahead of the curve when it comes to Diversity and inclusion. However, to make a real impact on attrition rates, you must confront the most significant factors in voluntary attrition: remuneration and career advancement.

At the heart of this is a competitive compensation package, which includes competitive rewards and benefits and a clear programme for learning and development.

So, how do you ensure what you offer is competitive? The truth is that it’s impossible to judge without looking at what similar businesses are doing, and this is no easy task. With salaries being well-kept secrets on job advertisements and competitors being tight-lipped about their offerings, it can be hard to understand where you’re going right or wrong as a business.

Why should you benchmark?

“You may want to ensure you’re remaining a top employer, an employer of choice, or you may want competitor analysis to know what your competitors are doing.”

Keisha Johnson, Recruitment Manager at Weil, Gotshal & Manges LLP 

What is benchmarking?

Benchmarking is a solution that provides the real-time data and insights you need to understand how your offer compares in the market. It highlights areas where you excel alongside those that need improvement.

Benchmarking principles can be applied to various areas, including:

  • Salary benchmarking
  • Rewards and benefits benchmarking
  • Diversity benchmarking
  • Learning and development benchmarking

Download the guide

Want to read this offline or share with a colleague? Simply fill in some details to download a copy.

How to conduct a benchmarking study

Step 1: Create a focused brief

For salary benchmarking, this means deciding which role or title to focus the research. A wider piece of work could address salary bands in a specific area. For other benchmarking studies, this may include defining the competitor organisations.

Step 2: Assess the internal offer

Map your internal offer, including seniority and responsibilities, titles, salary, and benefits. This may include mapping role families. For diversity and L&D benchmarking, this involves assessing your existing initiatives.

Step 3: Conduct secondary research

Examine job advertisements and industry news and conduct research through third-party data platforms to assess the offer for similar positions on the market.

Step 4: Conduct primary research

Identify relevant post holders within target organisations and make contact with them to gain first-hand insight into their experience. This enables you to compare the seniority and responsibilities of similar job titles to allow a deeper understanding of remuneration. A third party, like ourselves, enables you to do this in complete confidence.

Step 5: Collate your findings

Consider the location and management responsibilities of similar positions when making salary recommendations.

Salary benchmarking

The most common type of benchmarking concerns salaries. Salary benchmarking uses primary and secondary data sources to accurately benchmark salaries of specific roles within an industry.

Data is collected through job advertisements, third-party labour market data platforms and, most importantly, conversations with relevant post-holders in competitor organisations.

Salary benchmarking is helpful at all levels of an organisation, from junior staff to C-suite leaders.

Whether providing spot salaries or helping to define or update salary bands and pay grades, our salary benchmarking solution provides tailored results that ensure your company stays competitive.

sb-63-quit-2021Source: US Department of Labor’s Bureau of Labor Statistics


Rewards and benefits benchmarking

Rewards and benefits benchmarking often go hand in hand with salary benchmarking.

Where salary benchmarking looks at base compensation, a rewards and benefits benchmark determines the total package, providing a better indication of where your offer sits in the market.

This type of benchmarking looks at a broad range of elements, including:

  • Bonus structure
  • Pension
  • Annual leave
  • Parental leave
  • Private insurance
  • Life insurance
  • Car allowances

When taking this broader perspective, you may find that your base salary is higher than the competition, but the overall package falls behind the added value these rewards can offer. Conversely, some employers find they have a comprehensive benefits package, but a stronger salary offer tempts employees away.

Here again, data is derived from real-time conversations with post holders in the industry and other primary data sources such as annual reports and job adverts.

Diversity benchmarking

Benchmarking can also be applied to diversity. This approach is gaining popularity as companies seek to increase transparency, track the progress of their diversity programmes, and find ways to improve.

Whether related to gender, sexuality, or cultural background, it is a great tool to help inform strategic decision-making at the executive level.

Diversity benchmarking can influence workforce planning, recruitment practices, and overall corporate strategy to widen the talent pool and ensure fairness throughout the recruitment process.

By understanding where diversity may be lacking, plans and tools can be tailored to your needs and allow your company to develop plans aimed directly at tackling these issues.

We gather insight into diversity in a similar way to salary benchmarking. We speak with appropriate candidates in comparative organisations, map the talent pool, perform data analysis, and determine through additional secondary data sources where industries may need to catch up on affirmative action and diversity planning.



L&D Benchmarking

Recent research by LinkedIn found a clear link between a lack of learning and development opportunities and attrition. Put simply, employees who can’t see a route to advance or learn new skills are more likely to leave. 


A robust Learning and Development programme helps guard against this exodus whilst providing numerous benefits beyond loyalty. These programmes can help train new skills, update current skills and identify succession paths for star employees. 

An L&D benchmark uses a combination of primary and secondary research methods to examine your competition and reveal the programs they offer. This may include relevant technology partners, company initiatives, partnerships, and certifications.



“When we do analysis, we’re looking at the top 25 to 50 roles that drive disproportionate value. We break down the value agenda and ask, “How are we going to make money in the future?” Some parts will be new. Others will be sustaining.”

Bryan Hancock, McKinsey leader and talent expert

How benchmarking affects your business

Benchmarking enables you and your company to make impactful decisions regarding compensation and reward and can also help you identify how you perform in relation to diversity and learning and development initiatives. This insight is then available to drive change, enabling your business to make informed decisions that affect the whole talent management cycle. 

Suppose the benchmarking reveals your company is not offering competitive salaries and benefits. In that case, you have identified a significant factor in recruitment and retention difficulties, especially in niche industries where talent can be hard to find.

On the importance of benchmarking, Keisha Johnson states, “You know what you pay your employees, but if you’re getting pushback, saying that salaries are behind the market, that’s only anecdotal. Salary benchmarking can confirm and allow you to make a business case to allow salaries to be raised or addressed. If you believe something is incorrect, you need evidence to support that.”

"You may have a feeling about what your competitors are paying or what initiatives they offer. Still, by using a benchmarking service like the one available with Talent Insight Group, you get accurate and real-time data, evidenced through primary research and conversation with post holders and secondary data analysis gathered from online analytics tools and job adverts."

Rob Dolan, Senior Research Director, said, “[benchmarking] is beneficial and allows companies to position themselves competitively within their area. If they’re having difficulty in hiring, benchmarking can provide an edge and help determine why they aren’t able to hire.”


How benchmarking helps

As part of significant plans to grow the business across the African continent, our client needed to understand the market, pay and reward data and the competitors operating in that space. We were asked to carry out research and share insights that would help to set the strategy for this essential area of development.

We uncovered the insights they needed, quickly but accurately to minimise risk.

Read the full case study

Turning data into tangible goals

Through benchmarked information, companies are enabling their own future success and growth. With evidenced and insightful information, businesses are in control of their external opinions and narrative within their industry.

Benchmarking can also assist with internal engagement and employee productivity. But how can we use this data and turn it into real results?

Keisha Johnson provides some insight: “For us, when we’ve looked at diversity benchmarking for example, it’s cut and sliced to say ‘yes, you may be behind or ahead of the market’ and you can introduce measures as a business on how to tackle that issue. You can say at X time where were here, and by X date we want to be there.”

You can benchmark at a later date and see the progression that has happened, or where more resource may be required.

She added “if you see there aren’t many women, is that because of the individual business or the sector? Unless you use benchmarking, you don’t know.”

Benchmarking can be utilised to help create progressive salary bands, or compare your total rewards package against your competitors.

If you are offering the same base pay, and your competitor offers a better pension or more attractive benefits, unless you’ve received benchmarking information, you may not be aware of that gap and how that could be impacting your ability to recruit for similar roles.

As employees become more productive, salaries are not reflecting this. According to the Office for National Statistics, employee output is increasing 0.5% quarter on quarter, even with Covid-19 and furloughed workers.

Total hours worked also increased 2.5% quarter on quarter as restrictions unwind and we return to more normal economic activity.

This can increase the risk of employee retention, particularly if your employees are being offered higher salaries or better benefits elsewhere. We also see echoed throughout our research that remote and flexible working are becoming increasingly popular, and are strong motivators for workers looking for a change.

Download a copy

We hope you are finding this guide useful. To download a copy, simply add your details to the form.

How we help

Our talent intelligence service provides various benchmarking services, giving our clients research and insight that helps shape future hiring strategies. Whether you need benchmarks to guide specific role remuneration or company-wide initiatives, we can help. 

We can uncover a wealth of information, including:

  • Competitor insights, such as organisation design, benchmarking and hiring activity.
  • Candidate motivations, understanding whether your offering meets their needs, values and preferences.
  • Employer brand perception externally
  • Labour market, employment statistics and salary insights
  • Location insights to guide decisions about relocations, new offices or facilities or switching to remote or hybrid working models.
  • Best practice as an employer, helping you understand the strategies of other businesses, competitors or market leaders.

We work in partnership with our clients to ensure that we uncover the insights you need, and our extensive experience means we can also guide you on the key metrics that will maximise impact. We use a mix of primary and secondary data to ensure our insights are robust and reliable.