2 months ago

Why lack of salary transparency in job postings?

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Searching for a new job online? You may have noticed that many online job postings on websites like BD jobs, or even LinkedIn in Bangladesh most often leave their salary expectations section blank. Some even say "negotiable" without any range of salary. Why is this so?

The issue at hand is that, unfortunately, company recruiters and job applicants are never on a fair playing field, with one side holding significantly more information and leverage in the hiring process. A harsh reality of the job market, really. When submitting CVs or resumes, job seekers willingly have to give up their entire work history and even personal info to apply for a position, giving companies access to a wealth of information about potential candidates without getting anything in return. At the same time, job seekers, especially right out of university, are left in the dark regarding the value placed on the qualities and skills they possess. This power imbalance allows for information exploitation. Not only that, but young job seekers feel disadvantaged in the hiring process, and it undermines the quality of skills vs compensation. This begs the discussion: Why is there a significant lack of pay transparency in job postings? Do companies do this because they simply can as a power move, or could there be more?


Turns out there is more to it but not a whole lot. According to McKinsey & Company, a top global consulting firm, one of the main reasons is to avoid internal and external competition. In today's market, companies also hesitate to advertise their compensation packages and benefits because it makes them vulnerable and prone to competition both from outside hires and current employees. Competing organisations could and often do use salary information to win candidates by offering them more money or by targeting high-performing senior executives. However, in Bangladesh, sometimes the hiring team simply wants to receive as many profiles of candidates as possible. Some entry-level postings conceal the pay information while requiring a minimum experience of 2-4 years from fresh university graduates, which in reality is very counterintuitive and, frankly, unfair.

But is concealing salary amounts even legal? This goes for public vs private sector differences in jobs in Bangladesh. While the public sector more readily advertises salary expectations, hours worked and benefits, playing the secretive game is a private sector thing. It's a freedom of sorts; companies may do as they wish with no repercussions. Sadly, it is very much legal both in Bangladesh and beyond. Bangladeshis are quick to look up to developed countries and use them as prime examples for our betterment, but it seems like a lack of labour laws contributes greatly to the exploitation of talent worldwide.

If we look at developed countries like the US or Canada, this issue presents itself a bit differently. While they, too, have job postings that do not declare salaries out in the open, there are resources like that readily show us the competitive market value of the job position while protecting anonymity. The Bangladeshi equivalent should be created instead of relying only on Facebook groups.

Now the question comes whether there should be salary transparency laws. The EU Pay Transparency Directive was enacted very recently, and seems like some other western countries are starting to follow suit. The requirements include employers' having to inform applicants of the starting pay or pay range, either in the job posting or before the interview. Eight states in the US have salary range transparency laws, including California, Colorado, Connecticut, Maryland, Nevada, New York, Rhode Island, and Washington. Even in Canada, the Pay Transparency Act was passed for British Columbia. While many Asian countries lack pay transparency laws, Bangladesh is no exception. The government of Bangladesh should highly consider enacting specific laws in place to reveal the pay range in order to avoid the exploitation of labour, especially because manpower is one of the greatest contributors to the economy.

This continued exploitation is concerning more so because given the urgent need for employment for many people who are not able to afford to be picky about their job prospects. The fact that some employers have so much confidence in their ability to attract candidates despite their lack of transparency about pay shows us that they are relying on desperation rather than the actual quality of their job offerings to attract applicants. This is a worrying pattern that puts a negative strain on both job seekers and the job market economy as a whole.

Notably, these listings tend to list a long table of desirable qualities and skills, painting a picture of the perfect candidate with the ability to go above and beyond while failing to reveal the monetary value placed on these qualities. This lack of transparency makes it difficult for talented individuals to really understand why they should be eager to work for the company in question. Even if they join these companies and are underpaid, they will ultimately switch resulting in low retention rate. Transparency is important because it goes hand in hand with trust. You can't have one without the other. And without them, your workplace culture and relationships will suffer. Lies and secrets break trust, while honesty and transparency build trust.

Here is a tip for the applicants, do your research, primarily by talking to people in similar work fields. Being educated about the companies you apply to, the industry, and the job market is the best way to land a great job at a salary that works well for you and the company. So, even if there are reasons why salary isn't listed on a job posting, you can still be prepared to negotiate and get what you deserve.

Tazrian is an aspiring researcher in economics and a member of the Youth Policy Forum Environmental Team.

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