Sunday, January 6, 2008

"Competitive salary" a useless term

One of my pet peeves in job ads is the term "competitive salary". This term means nothing and therefore deserves translation and explanation. Below is what "competitive salary" can mean, and, to make it more tiresome, it can mean any one and all of these.

1. "Competitive salary" can mean that the employer's offer is in the range of the average salary according to the MGMA (Medical Group Management Association) lists.
This is the explanation I heard from a recruiter: "The MGMA does a tremendous job tracking each specialty, how much revenue a particular physician brings in, how large the population draw must be for a specialty to make sense to either expand or create. The industry of health care has many cut and dried business formulas. The RVU production model is one prime example of one of those formulas. An average OBG generates $1,413,436 in revenue annually for in/out combined and has a total RVU of 13,166 with each RVU valued at $43.49. For example the median salary for OBG physicians is $271,425 and if I had a really, really good opportunity I would refer to the percentile to indicate the range of salary. For example the 75th percentile for OBG is $350,000. So since my opportunity is "competitive" you can assume it's average and not over-the-top fantastic because I didn't refer to the percentile." - End of quote.
Well, NOW you know, right? You, like every job seeker, have nothing else to do but to pay the MGMA $520 for this info as soon as you start looking! And now of course you have this $520 list of averages sitting right on your desk.
This particular recruiter considered herself quite smart while in reality she is lost in her own world and has forgotten that the MGMA info is not readily available to everyone. SHE may know the averages, but YOU do not. If you read her comment closely, she says "competitive means average". Now that is great information...

By the way, here are two links to find out an approximate information of this kind, at least as national averages, even if this does not say much:NAPR
and Merritt and Hawkins

Another big problem that this recruiter chose to overlook is that this "average" varies. The average varies by experience, and it can vary from 180K in the first year to 270K after 5 or 6 years, this average varies by location, meaning in the South and in the Mid West it usually is higher and in New England it is lower, the average varies tremendously by HMO "penetration", it varies tremendously when you compare rural with urban areas and finally it varies by employer. Recruiters are not very concerned with urban jobs since they do not get them anyway.

And, how competitive is it? Very or hardly? Even if you knew the "average salary", is this particular salary competing in the 30%, 40%, 50%, 60% or 70%? You see, "competitve" spans probably more than 100K...

Turns out that "competitive" means NOTHING.

Do the following: When the recruiter asks for your CV, say that your CV is "competitive" and therefore you do not need to send it to him or her. Then may he or she will get the message.

2. "Competitive salary" is an evasive phrase used by employers that have not yet decided what they want to pay. They prefer to see what the candidates expect and then negotiate down from there.

3. "Competitive salary" is used by employers who want to take advantage of you. They are hiding the fact that their salary is below average. Sure it competes, but on the loosing end. They will only tell you after long talks, and after they feel that they have you on the hook, how little they really want to pay.

So, in summary, "competitive salary" is a completely useless term, and one that in the majority of situations works against you! Refuse to accept it and demand a clear statement about anticipated salary, such as "150-180K depending on experience". Statements like these should be the norm. Expect them, ask for them. Should an employer (or a recruiter if you really need one) not be upfront about the salary range, this may be a red flag.

3 comments:

The Doctor Job said...

I've seen clients get salaries in one city that differ as much as $60,000. I agree that "competitive salary" really means nothing.

Evil HR Lady said...

Excellent points. It seems you've crept into the recruiter's mind.

vishnuprasath said...

It's useful information
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