A compensation analyst works with various stakeholders within an organization to ensure that pay and benefits for employees are aligned with market standards, as well as any local, state and federal regulations.
What Does a Compensation Analyst Do?
Compensation analysts help ensure that a company’s compensation structure enables it to attract talent and retain its employees. They combine employee and market data to design compensation packages and salary ranges for each role within the company. Their research also informs decisions on raises, pay adjustments and whether or not a role should be categorized as exempt or non-exempt from overtime pay.
Common Compensation Analyst Skills and Qualifications
- Bachelor’s degree in finance, human resources or business
- Strong analytical skills
- Understanding of local, state and federal labor laws and regulations
- Communication skills
- Organizational skills
- Certified Compensation Professional (CCP)
Is Compensation Analyst a Good Career?
A compensation analyst role is a highly specialized HR profession. Becoming a compensation analyst is a great career choice for HR professionals who enjoy using their analytical skills. This role is a good fit for someone who is interested in pursuing an HR career with a focus on math, research and analytics. In addition, this role plays a big part in promoting internal pay equity in a company through pay equity audits.
What Is the Salary of a Compensation Analyst?
The salary and benefits for a compensation analyst depends on a variety of factors including the size of a company, industry, experience level needed, location and responsibilities. The overall market salary rate may also change based on economic factors such as inflation. To get a sense of open compensation analyst positions and salary ranges in your region, head over to Built In’s salary tool.
How Do I Become a Compensation Analyst?
Different companies may have varying role requirements for compensation analysts, so it’s important to identify companies or industries in which you are most interested. However, here are some general skill requirements and relevant background to consider as you work toward landing your first compensation analyst role.
Bachelor’s Degree in Finance, Human Resources or Business
Outside of meeting the bachelor degree requirement for a compensation analyst job posting, gaining compensation knowledge along with general analytical and statistical skills will go a long way in helping anyone aspiring to become a compensation analyst.
Strong Analytical and Statistical Skills
As a compensation analyst’s work revolves around statistics, data and analytics, it’s crucial to develop strong competencies in these areas. You can do this through a continuing education course or take advantage of various online learning opportunities.
Knowledge of Local, State and Federal Labor Laws and Regulations
It’s important to become well versed in these laws and regulations to protect a company against compliance issues. Some of these laws and regulations include the equal pay act and the fair labor standards act.
Although the bulk of a compensation analyst’s responsibilities requires analytical skills, good communication skills are also required to be effective in this role. Working closely with various stakeholders, compensation analysts must be able to convey clear messages and make adjustments to their communication style based on the audience. This is especially important when we consider a compensation analyst drives a company’s compensation practices, a topic about which everyone in the company has a stake and an emotional investment.
Compensation analysts manage multiple timelines and priorities. With various processes, including performance raises and pay equity audits, the ability to organize and manage tasks is a major strength for a compensation analyst.
Certified Compensation Professional (CCP)
The Certified Compensation Professional (CCP) is an HR accreditation that signifies the attainment of knowledge and training required to design and implement compensation structures and related programs.