U.S. employers are increasingly posting salary ranges for job openings, even in states where it’s not required by law, according to analysts with several major job search websites.
Following new legislation in California, Colorado, New York City, Washington and elsewhere, employers across the country are becoming more transparent about pay in order to stay competitive with companies in states that require employers to post salary ranges, say experts. A tight labour market and significant increase in remote working have also contributed to the rise.
The number of U.S. job postings that include salary information more than doubled between February 2020 and February 2023, from 18.4 per cent to 43.7 per cent, according to a new report from Indeed.com.
Read: Pay transparency could help solve gender, racial wage inequities: experts
Salary visibility is lowest in the southern U.S. — which accounted for 18 of the 20 least transparent metro areas — and highest in the western part of the country, which tends to have more regulation.
Advocates say it’s a trend that benefits women and people of colour, who statistically fare less well in hiring negotiations. Rather than placing the responsibility on the job seeker or employee to determine how their pay compares to coworkers and what fair compensation might be, the laws shift that expectation to the employer.
Kate Bahn, chief economist at the Washington Center for Equitable Growth, says this change means employers have less of an upper hand in determining pay. Laws that forbid employers from asking potential hires about salary history in recent years do similar work.
In 2021, the median pay for full-time women workers was about 83 per cent of men’s pay, according to federal data, which noted women make less than their male counterparts in nearly all fields. Black women make 64 cents for every dollar paid to white, non-Hispanic men, according to a report by the National Partnership for Women and Families. Latina women make 54 cents and Native American women make 51 cents.
Read: How employers can leverage pay transparency to achieve pay equity
Keegan Vance Forte, a freelancer based in Jersey City, New Jersey, is looking for a permanent position either in New Jersey or New York. She says she’s noticed more salary listings for open roles in both states during the past several months than she did when job hunting in the past. “I’m still getting used to it. When I see a salary posting with a job listing, my eyes widen.”
In the past decade, Forte has held roles in business development, marketing and company partnerships and she says knowing the available range is helpful to avoid wasting both her time and the hiring manager’s. “Instead of dancing around the elephant-in-the-room question at the end, you at least know you’re playing in the same ballpark.”
Daniel Zhao, lead economist for Glassdoor.com, said compliance with the new laws requiring disclosure is already strong in California, New York City and Washington and is even stronger in Colorado, which has had a law mandating transparency in effect since 2019. “The additional compliance in Colorado implies it will improve in the other states. And what we’re really noticing is that, since the laws have taken effect, more employers have decided to share salaries nationwide.”
Read: How B.C.’s pay transparency legislation could impact employers
Major companies, including Citigroup Inc., Google and Microsoft Corp., have publicly committed to posting salary ranges for all jobs across the country, rather than only in the states where it’s legally required.
“Companies that are not necessarily in locations that now have laws [are] disclosing that information anyway,” says Vicki Salemi, a career expert at job website Monster.com. “It’s becoming more of the norm because job seekers are expecting it.”
She says employers tend to compete for job candidates across state lines, including neighbouring states that have different laws. “That means it’s in their best interest to start sharing their own ranges, so the job seekers can compare apples to apples. It’s a virtuous feedback loop.”
In New York City, the NYC Commission on Human Rights is early in its enforcement efforts, but Jose Rios Lua, the commission’s executive director of communications, says the new law has been “life-changing for a lot of folks. “Before they’ve gone through what could turn out to be a long application process, they know the salary range, so they know if a position is worth pursuing. For those in lower-earning jobs, it might mean the difference from living paycheque to paycheque.”
Read: 84% of Canadian employees in favour of pay transparency law: survey