Latest / Hiring & Firing with Fexingo: Recruitment, Performance, and Workforce Decisions / How a Salary Band Became a Hiring Advantage
Transcript
- Lucas: So, Luna, I have been digging into something that feels counterintuitive: a company that deliberately posts its exact salary band for every open role, and it's actually helping them hire better, not worse. Luna: Wait, you mean like telling candidates upfront what they'll pay? That sounds like a great way to scare off your best talent. Lucas: That's the assumption, right? But this firm, a mid-size software company in Austin, decided to test it. They publish the full range—minimum to maximum—on every job ad, and they've seen their time to hire drop by twenty-three percent. Luna: Twenty-three percent? That's not nothing. What about offer acceptance? Lucas: Also up, by about eleven percent. And here's the kicker: they're not paying more than the market rate. Their bands are in line with what competitors offer, they just say so upfront. Luna: So why would that change anything? If the money's the same, why would a candidate prefer a company that tells them the number early? Lucas: Because it removes the uncertainty. There's a 2025 survey from a major job board that found seventy-one percent of job seekers are more likely to apply if a salary range is listed. It's about not wasting anyone's time. Luna: But doesn't it also invite lowballing? I mean, if you show your ceiling, why would a candidate negotiate for more? Lucas: That's the fear, and it's real. But this company found the opposite. Their recruiters say candidates come in better informed, and they're more open to roles that fit within the band, even if it's not at the top. It's like the band itself becomes a trust signal. Luna: Trust isn't usually the first thing you think of in salary negotiations. You think zero-sum. They want more, you want to pay less. Lucas: Right, and that's the old mindset. This firm's head of people ops put it well: 'We're not negotiating against the candidate, we're negotiating against the unknown.' When the range is public, the conversation shifts to fit and growth, not guesswork. Luna: But I've also heard that transparency can backfire if your bands are too wide. If you say 80 to 160 thousand, that's not really a band, that's a suggestion. Lucas: Exactly. This Austin firm keeps their bands tight, usually within twenty percent of the midpoint. They argue a vague range is worse than no range, because it feels like a bait and switch. Luna: So what's the actual mechanism? Why does a posted range make someone more likely to apply, not less? Lucas: Part of it is self-selection. Candidates who see a range that's too low won't apply, saving everyone the hassle. But for the ones who do apply, they've already mentally accepted the range, so the offer feels fair. Luna: That makes sense. But doesn't it also make it harder to attract that really senior person who might want a sign-on bonus or equity on top? Lucas: They've handled that by being transparent about the whole package. The band is for base salary, and they list potential bonus percentages and equity ranges too. No hidden carve-outs. Luna: That's pretty radical. How do their current employees feel about it? Isn't there a risk of internal pay compression when you're this open? Lucas: That's the part I found most interesting. They actually went through a compensation audit before they started posting bands, and they had to fix some internal inequities first. Two people in the same role with a thirty thousand dollar gap—they had to bring the lower one up. Luna: So the transparency forced them to get their house in order. That's a big project, not just a marketing tweak. Lucas: Right. Their CEO said it took about a quarter of hard work, but it paid off in retention. They saw voluntary turnover drop by fifteen percent in the following year, which more than offset the salary increases. Luna: So is this something that only works for tech companies? I can't imagine a factory or a retail chain posting bands for every shift role. Lucas: It's easier in knowledge work, sure, but there's a spectrum. Some states now require salary ranges in job postings, so a lot of companies are doing it reluctantly. The ones that do it well treat it as a strategic choice, not a compliance checkbox. Luna: But for a small business, doesn't that put you at a disadvantage? You can't match the big tech salaries, so showing your range just makes you look cheap. Lucas: That's the counterintuitive part. This Austin firm is not a giant. They have about four hundred employees, and they're competing with much bigger names for talent. But they found that candidates appreciated the honesty, and some actually chose them over a higher-paying offer because the process felt more respectful. Luna: Respectful. I like that. So it's not just about the number, it's about how you treat people even before they walk in the door. Lucas: Exactly. And that's a theme we've touched on in past episodes, like when we talked about rejection emails that build a talent pipeline. It's the same principle: small signals of respect compound into a reputation. Luna: Speaking of reputation, you know what this show is like. We spend a lot of time talking about how companies can earn trust, and we try to practice what we preach. We don't run ads on Fexingo—never have. It keeps every episode focused on the substance, not on selling you something. Lucas: And if that's valuable to you, you can support the show at buy me a coffee dot com slash fexingo. No pressure, no perks, just keeping this thing ad-free. Luna: Yeah, it's a small way to keep conversations like this going. So, back to the salary bands—what's the one thing you'd tell a listener who's thinking about trying this? Lucas: Start with an audit. Don't just publish your current ranges without seeing if they hold up. This company's success came after they fixed the internal gaps, not before. Luna: And what about the candidates who see the band and think, 'That's not enough for me'? You lose them early, but is that a loss? Lucas: It's a win, honestly. You save your recruiters hours of screening time, and you build a reputation for being upfront. The data shows that people who apply anyway are more likely to accept the final offer. Luna: So it's a filter, but a fair filter. Not a gate to keep people out, but a door that only opens for people who actually fit. Lucas: That's a nice way to put it. And here's a final number that stuck with me: this firm's offer acceptance rate went from 81 percent to 90 percent. That's a nine-point jump, just from being open about money. Luna: Ninety percent is remarkable. I'd love to see more companies try this, but I get that it takes guts. Lucas: It takes guts, but it doesn't take a huge budget. It takes a willingness to be honest, internally first. And that's something any company can do, regardless of size. Luna: So the next time you're tempted to keep salary details close to the vest, maybe ask yourself: what are you really protecting? Lucas: And what could you gain by opening up? That's the question worth sitting with.