Last year, three states Washington D.C., California and New York took major steps in progressing forward toward pay equity by overhauling their pay transparency laws.
A quick recap, since January 1, employers in Washington and California with 15 or more employees are required to disclose salary ranges in all job ads, while the same law will take effect in New York State in September (currently only pockets of the state like New York City and Ithaca have legislation in place).
These statewide sweeping changes have made pay transparency a juggernaut of the job market, prompting other states like Massachusetts and South Carolina to put this topic on their agenda.
Read more: What is salary transparency and how does it vary state by state?
You might be thinking that such legal reform would certainly transform the job landscape for the better and drastically improve the experience of searching for a job. If that’s the case, you’re not alone; our previous research revealed that a lack of clarity on salary in job ads is one of the biggest pain points for jobseekers and a major frustration for many.
Read more: What annoys jobseekers the most during job hunts?
However, there’s no stringent guideline on salary range as the law requests employers to include a “good faith” salary range in job listings. Some employers decided to abuse this flexibility and find grey areas. They provide excessively large salary ranges that are not helpful to job applicants, while blatantly taking the credit for being a fair employer.
In this article, you’ll find out what an acceptable range is, which states have the widest salary bands, which states are holding themselves upright, and how to answer “What are your salary expectations?”
What is an acceptable salary range?
How wide is too wide? Our gauge is if the difference between the minimum and maximum salary for the job is bigger than $50,000. For example, $50,000-$150,000 or $45,000-$245,000, that’s outrageous.
Our advice for employers who are new to pay transparency is to keep the salary range discrepancy up to $20,000 wide for more junior roles. For example, $50,000-$70,000. As for senior roles, it’s plausible to have a wider range because the applicants’ experience and qualification can vary, but it’s best to aim for a maximum of $50,000 wide as ranges wider than this start to become meaningless. If employers are unsure about the level of experience they’re looking for or they do welcome candidates from different expertise levels, they should be upfront about this in the job ad to avoid misunderstandings.
Advertising the minimum and maximum amount of pay in a job ad can help companies weed out candidates that don’t match their hiring budgets and reassure potential employees that the company cares about being fair and transparent. For jobseekers, on top of the obvious benefit – they can save time and energy from applying for jobs that don’t match their salary expectation – having salary ranges can also help them get a glimpse into the future and learn about their potential salary progression.
A good rule of thumb for employers is to treat others as you would like to be treated. How would you feel if a candidate’s answer to salary expectations was very vague?
Read more: US is one of the worst countries for pay transparency
The states with outrageously huge salary ranges
Washington State might be one of the pioneers in mandating salary ranges in job ads but the state is the worst offender when it comes to large discrepancies within salary ranges. Close to half (46%) of all job ads where the difference in salary ranges is between $200,000 and $500,000 are located in Washington. California closely follows, with 17% of job ads having such huge compensation ranges differences.
We’re not done with the Golden State yet. California has the highest number of job ads where the advertised salary bands land between the $50,000-$200,000 range. Precisely, 5,898 job ads in California are displaying a salary range with a $50,000-$100,000 difference, and 442 job ads have a $100,000-$200,000 difference.
The model states: New York, Texas, and Utah
The good news is that across all states, even Washington and California, the majority of the salary ranges in job ads are less than $50,000 wide. It’s just that there are a few bad apples.
Three states that are doing a particularly great job are Texas, New York and Utah. Most salary bands for job postings in these states were less than $20,000 wide. Taking Texas as an example, 7,919 job ads in Texas are citing salary ranges with up to $20,000 difference between the minimum and maximum salaries, while only eight job ads have $200,000 – $500,000 discrepancies.
A deeper dive into California, New York and California
In Washington, Park Place Motorcars was identified as the worst offender, with significant discrepancies in salary ranges for both sales and admin roles. For a sales job, the advertised salary ranges from $60,000 to $350,000, that’s a $290,000 difference! Similarly, its advertised admin position is offering salaries up to $350,000.
Ironically, in California, jobs in the HR and Recruitment sector have the most ridiculous salary bands. On average, job postings are citing salary bands with a difference in minimum and maximum salary of over $140,000 wide. The worst offender we spotted was advertising a salary from $40,000 to $300,000 – a $260,000 difference!
In New York, Sales roles came in a close second, with salary ranges as wide as $100,000 to $350,000 – a $250,000 difference.
Conversely, the lowest salary ranges fell into the sectors of Engineering, Healthcare & Nursing, Construction, IT and Accounting & Finance. In Washington, an IT job posting at Liberty Mutual includes a salary range of $70,000 to $120,000 – a mere $50,000 difference. A UnitedHealth Group posting for an Accounting & Finance job includes a pay range of $66,000 to $118,000 – a $52,000 difference.
How to answer salary expectations interview questions
While pay ranges in job ads can alleviate job hunting fatigue and stress, jobseekers should be mindful of the fact that employers can still make an offer outside the pay range in job ads. It’s a “good faith” estimate at the end of the day, meaning what you are seeing could be the 25th or 75th percentiles of what they would actually pay. Don’t assume the pay range is all set in stone and don’t get too carried away by the maximum salary. You can always negotiate more if you’re confident.
A good way to find out your worth in the job market is use this tool ValueMyResume, which can also help you understand the market average in your industry and what other professionals with a similar background are earning. Based on the results, set a salary range. Keep it as tight as possible.
If you’re tired of not seeing salaries in job ads, start your job search with Adzuna. We make an estimate for every ad that doesn’t have a salary, and we’re within 10% most of the time.
If you’re interested in transforming the job landscape for the better, sign our salary transparency petition now.
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