Pay Compression: What Employers Should Do About It

Content Summary

When a new hire starts at the same pay as someone who’s been with you for 12 years, you have a pay compression problem. It usually builds slowly, as market rates and starting wages climb faster than raises for current staff. Left alone, it hurts morale and pushes experienced people out the door.
This guide treats compression as a consistency problem, not a new-hire problem. It covers how to compare current pay against starting rates, check that your pay criteria still hold up, and review where each employee sits in their range.

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