Labor market monitoring is an important process. It plays a big role for both employers and wage earners. Everyone is eager to find out what is the average salary in the labor market in order to sell their labor as profitable as possible, if it is an employee, and what competitive salary should be set in the case of an employer in order to attract as many skilled and conscientious personnel as possible.
Labor market monitoring
In order to know and correctly assess the state of the labor market, it is necessary to carefully study it and constantly monitor the situation. However, the question arises here: where does the information come from and how is the labor market monitored?
To be aware of the changes that occur, you need to know the salaries of various enterprises and firms, how they depend on the specifics of work, industry, type of economic activity, etc.
Monitoring advantages
Monitoring the labor market and wages is important primarily for employers. It is they who study supply and demand, form a salary for their staff, and act as an important element in the system of relations.
What are the benefits of monitoring labor market? First, one can assess how attractive the amount of money offered by the employer to the employee is. Secondly, compare the wages of your company with others, thus studying the competitive environment. Thirdly, find out how the price of a specialist differs depending on his qualifications. Fourthly, the employer can see and set salary boundaries for employees of various classifications and levels of training.
What is it for?
Constant and high-quality market monitoring, in addition to the above advantages, helps the company to keep abreast of current changes that are occurring in the labor market. The employer gets the opportunity to independently determine the boundaries of the wages of an employee of a certain level, while doing this systematically, so that the salary level corresponds to the average in the current period.
For example, every year, taking into account inflation, an employee needs indexation of wages. The employer is forced to raise it so that his employee does not go to the company of competitors. However, by monitoring the market situation, he can track the dynamics of salary increases in different companies in any industry and, based on these data, decide not to index wages, because in this case it makes no sense for a specialist to leave for a new, unfamiliar company with those same conditions.
Recruitment
One of the decisive factors in hiring a hired employee will be the assessment of the company's salary, its comparison with other similar firms and industries. For an employer who decides which salary limits to set for a particular position, labor market monitoring will be an important factor.
Accordingly, from this we can draw conclusions about how the situation of employment will develop if both subjects of labor relations analyze the current situation.
When an employer starts searching for job seekers for a vacant position, he puts forward requirements for a future employee, i.e. indicates the desired gender, age, level of education and qualification, knowledge of foreign languages, additional internships, diplomas, etc. From here, taking into account the average wage in the labor market, he sets the boundaries of wages, introduces a bonus system and much more. The applicant, in turn, evaluating the requirements, nominates his candidacy only if he understands that he meets the requirements and will receive a really decent salary, more than in other firms.
What is the result of ignorance of the situation on the labor market?
Suppose an employer has monitored the situation on the labor market. The results protocol makes it possible to find your way and find a suitable candidate as quickly as possible. However, there are times when the employer wants to set the wage range himself. In such situations, like any other entrepreneur, he wants to save money, find a qualified specialist for less money. Having set the price for an employee below the market, the employer will be forced to look for the applicant from month to year. Since a person always views various advertisements, he will therefore see the difference in the proposed conditions and will not want to associate himself with such a company.
Knowing the level of average wages in the labor market, the employer sets either a similar amount or a little higher to pick a specialist from competitors.
Sometimes, when expanding a company and opening branches, directors and managers have to quickly search for employees. A major role in this case will be played by monitoring the situation on the labor market.
