Salary Range Definition and How It Works for Employers

What is salary range? Or range salary? Hiring managers can inquire about your preferred pay range throughout the interview process. This gives them a better idea of how much money they should set aside for your pay.

It's ideal to do your research online utilizing a pay calculator and consider things like your experience, education, and location you work in when establishing your compensation range.

salary range

What is a salary range?

A salary range is the amount of money an employee expects to be paid between a set of low and high figures once they've been employed by a company. There is a low, a mid, and a high wage point in the salary range.

For example, if an employee states that their pay range is $60,000 to $70,000, it indicates that they want to be paid in that range. Employers and candidates alike might benefit from presenting a pay range as a negotiation tool.

When are salary ranges used?

During the interview or offer phase of the job search process, an employee generally utilizes a wage range. Based on factors such as job demand and employee competence, they offer the recruiting manager an estimate of the salary level they want. The company will look at the pay range and figure out how much to give the employee within that range.

The pay range is an estimate to assist companies to understand what the employee expects to be paid and how they value themselves. Employees should offer a wage range, with the lowest point being the lowest income they can accept while staying financially stable.

Providing a wage range to employers is an efficient way for potential employees to negotiate their compensation and perks.

Things that affect salary ranges

Before providing the recruiting manager any estimates, you should research and evaluate numerous factors as you establish the pay range to seek.

Salary ranges for various occupations are influenced by a number of factors, including:

  • How long have you been working in the sector or industry you're applying for?
  • What kind of degree did you get?
  • If your role has a limited number of people available.
  • If the company is attempting to attract you and intends to pay you more than you are already earning.
  • If you have good recommendations and references from prior employment.
  • If you have a wide range of relevant talents and advanced certifications.
  • In your area, how much does it cost to live?
  • Pay scales in the industry you want to work in.

Job applicant vs. employer salary range

While a job applicant's wage range is an estimate of what they'd like to be paid, it has a different significance for an employer. When a company gives a compensation range, they are indicating the range of pay they can offer an employee, from the lowest to the greatest.

The wage range includes the employee's starting pay, which is the lowest pay rate. They take into account the increases, promotions, and pay incentives that an employee will receive while they continue to work for the company. This is the highest possible pay rate.

For example, if a business offers an employee a job and specifies a salary range of $60,000 to $70,000, it indicates the employer has set aside this amount of money to pay the person. The initial wage is $60,000, and the company plans to pay the employee $70,000 after giving pay rises over the course of a few years in the position.

The wage range might be wide or narrow, depending on the position. Executives looking for management positions often have a higher pay range than employees seeking lower-level positions.

How do employers determine salary?

When businesses are deciding on a wage range for their employees, they frequently undertake research online to arrive at a precise figure. They can use pay calculators to find out how much the average employee in that field earns.

This data comes from market studies that provide typical pay ranges for certain job titles in various locations. They also take into account things like experience, education, and the number of persons that apply for these positions.

Employers utilize this data to create their own estimations based on the company's budget and the candidate's credentials. They also take into account the perks they want to provide the employee. Before settling on a remuneration sum, hiring managers should consider their company's principles and culture.

If the company prides itself on valuing its employees, pay might be used to show them how much they value their job.

What tools can I use to determine salary?

The following salary calculators and salary information can be useful:

What factors go into making a minimum pay rate or average salary?

The following is considered amongst employers to determine salaries:

  • Job title.
  • Human resources annual budget.
  • Maximum pay rate or salary.
  • Starting salary figures with opportunities for advancement.
  • Labor markets.
  • Geography.
  • Bonus philosophy.
  • Benefits and other compensation.
  • Similar positions and their compensation.

How to negotiate salary based on a salary range

Employers can give you with a wage during the interview and job offer process, which you can wish to alter based on your financial and personal requirements.

To negotiate a pay based on the salary range you specify, follow the steps below:

Analyze skills, expertise, experience

Plan your talking points before meeting with the hiring manager so you can effectively explain your bargaining conditions and why you deserve them. This can be accomplished by assessing your skills and expertise and presenting them to the company. Make a list of your abilities, experience, education, and any other credentials that you feel qualify you for the pay you want. Before speaking with the recruiting manager, practice and prepare these.

Research common salaries for your role

Make sure you're bargaining for the right price by doing some research online. Look for reputable pay calculators that offer an estimate of how much an employee in the position you're looking for could earn on average. Also, look for a calculator that predicts how much someone can make in your region. When bargaining with the employer, keep these figures in mind.

Determine the salary range based on geography and experience

Determine your pay range and submit it to the recruiting manager after you have a better notion of the amount you want to ask for. It's best to figure out how much you want to produce and utilize it as a starting point. Make sure your salary range's minimal pay rate is sufficient to keep you financially stable.

Once you've established this range, bring it to the hiring manager and confidently share it with them. Explain your prepared arguments for why you feel you deserve this amount if they appear reluctant.

Negotiate additional benefits

If the recruiting manager gives you a lesser salary, inquire about the benefits package. They can offer you substantial benefits in lieu of larger pay. Extra vacation days, additional paid vacations, or effective health plans are examples of this. Examine the aspects of your remuneration that are most important to you. If additional vacation days are more essential to you than a better income, request them instead of a raise.

Show gratitude, appreciation, and respect

Once you've reached an agreement on conditions that you're both happy with, express your gratitude for the job and the pay offer. Because you'll be dealing with them on a daily basis, it's essential to start on a professional and polite footing. If you're meeting in person, extend a handshake and express your gratitude for their time and compensation offer.

Common questions

Questions about salary ranges.

How do I find an ideal salary range?

Use salary research to find a salary range. From there, explain the research that was performed on the job market and how the range was determined during the salary negotiation stage of the job discussion. Annual salary should include benefits, bonuses, and other compensation benefits for new employees.

What is a salary philosophy?

A salary philosophy is the research used to determine a salary offer. From either the prospective employee or employer. The more open your pay and wage philosophy and decisions are, the more likely high employee morale and motivation will result.

What are base salaries?

The original wage provided to an employee, without any perks, bonuses, or raises, is known as base pay. It refers to the amount of money an employee gets paid in return for their services. The hourly rate, weekly, monthly, or yearly compensation of an employee are all examples of basic pay.

An employer could use exceptional benefits to enlist employee motivation, rather than pay increases. Often, pay only motivates employees a nominal amount. Companies participate in equity sharing programs or revenue sharing programs as a more valuable asset amongst their personnel.

Do qualifications affect salary?

Certainly. Those with higher qualifications or experience can experience higher salary ranges. Usually, on the upper band of the range of salary that's already determined on behalf of the employer. Increased responsibilities usually coincide with higher compensation or more money.

salary range

author: patrick algrim
About the author

Patrick Algrim is a Certified Professional Resume Writer (CPRW), NCDA Certified Career Counselor (CCC), and general career expert. Patrick has completed the NACE Coaching Certification Program (CCP). And has been published as a career expert on Forbes, Glassdoor, American Express, Reader's Digest, LiveCareer, Zety, Yahoo,, SparkHire,,, FairyGodBoss,, St. Edwards University, NC State University,, Thrive Global,, Work It Daily, Workology, Career Guide, MyPerfectResume, College Career Life, The HR Digest, WorkWise, Career Cast, Elite Staffing, Women in HR, All About Careers, Upstart HR, The Street, Monster, The Ladders, Introvert Whisperer, and many more. Find him on LinkedIn.

Fact checked: Our small and dedicated team rigorously evaluates every article, guide, and reference to ensure the information is accurate and factual. Learn more.


Help us by spreading the word