The Cost of a US Employee - Salary

As we discussed in the previous post there are several cost elements to hiring a US employee. The next element for us to consider is Salary:

Knowing what to pay an employee is a delicate art that relies on both understanding the market forces and the willingness of the company to pass over an applicant because of a salary requirement that exceeds an original budget.

Any organization will have a budget for each position that has to be filled. However salary negotiations in the US are normal and often involve several offers and counter offers. Working with a recruitment company or a business advisor can certainly alleviate some of the unknowns involved in this process.

Alternatively services such as: 

provide broad ranges for both types of positions and grades of employee. These websites will allow an organization to fix a starting point for their budgets and negotiations.

It should be remembered that salary is only one of many components of total compensation that has a cost implication for a business. Other components include paid time off, bonuses, and retirement fund matches, though the latter two are more discretionary for the hiring company. 

Paid time off or annual holiday (vacation time in the US) is usually another element of compensation negotiations. The average employee in the US receives 10 days of personal vacation per year, usually calculated on a pro-rata basis for each month worked. And higher level, more experienced employees generally receive 15 or even 20 days per year. 

This is much lower than that given to employees in Europe and is increasingly becoming part of non-financial remuneration discussions.