OVERVIEW
What Is a Compensation Analyst?
Compensation analysts are experts in labor and compensation structures. They are an organization’s key researcher for all things remuneration. They inform, via their research, what to pay each position, how often to give raises, what competitors are offering in their compensation packages, and more.
They are typically analytically minded with an interest in finance, research, and organizational logistics.
Compensation analysts sit within the HR team of an organization and have a strong working knowledge of the human resources structure. They are knowledgeable of best HR practices and well-versed on the financials of a business. They are data-minded with a compassion for people, allowing them to prioritize both the financial health and goals of a business, alongside an understanding of what the people in their organization need.
RESPONSIBILITIES
What Does a Compensation Analyst Do?
Compensation analysts research, implement, and oversee an organization’s pay structure. They train to become experts on industry salaries, benefits, and remuneration policies and advise senior members of an organization on what to pay team members at various points of their employment.
The day-to-day duties of a compensation analyst may vary, depending on an organization’s needs and the size of its compensation team. Some days are filled with research and others are full of on-the-ground employee assessments. Typical duties and responsibilities can include:
- Create accurate job descriptions for each position in your organization, ensuring accuracy for the work each role performs
- Compare jobs against the industry’s market information to verify competitive compensation offers
- Build and maintain reporting and compensation metrics
- Ensure that compensation practices are in compliance with current legislation (pay equity, FMLA, HIPAA, etc.)
- Disclose company data to compensation and benefits surveys in your industry
- Manage raises and salary structure for all employees
- Analyze compensation package trends to ensure industry competitiveness and employee retention
Where Does a Compensation Analyst Work?
Compensation analysts can find opportunities in any industry, and in any location. As competitive fields continue to recruit competitive talent, knowledgeable analysts will be needed to fine-tune compensation and benefits packages.
EDUCATION & BEST DEGREES
How Do I Become a Compensation Analyst?
Compensation analysts typically hold a bachelor’s degree in a human resources-related field and some sort of HR or finance experience via an internship or entry-level role. A bachelor of science business administration in human resource management encompasses coursework like business management, accounting, psychology, industrial relations, and more, ensuring students have the business understanding to confidently enter an HR department. This degree also allows room for students to take specific courses catered to their HR field of interest.
Most compensation analysts will be required to hold a bachelor’s degree at a minimum. A bachelor’s of science in business administration with a major in human resource management is one of the most popular degree paths, as it sets analysts up particularly well for the HR department. They will take courses in business, finance, and accounting, in addition to their human resources coursework.
Compensation analysts can find a competitive edge in their job search by getting certified in key HR credentials. Following their bachelor’s degree, analysts might explore options from the International Foundation of Employee Benefit Plans and WorldatWork, which offer certification programs that specialize in compensation and benefits. Others, including the HR Certification Institute and the Society for Human Resource Management, offer general human resources credentials.
Best Degrees for a Compensation Analyst
Business
Human Resource Management – B.S. Business Administration
A SHRM-recognized online business degree program:...
A SHRM-recognized online business degree program:
- Time: 65% of graduates finish within 24 months.
- Tuition: $3,755 per 6-month term.
- Courses: 41 total courses in this program.
Skills for your résumé you will learn in this program include:
- Agile project management
- Employment and labor laws
- Recruiting strategies
- HR technology
- DE&I understanding
Earn your B.S. in Human Resources and help build strong organizations.
Business
Human Resource Management – M.S.
A SHRM-recognized master's degree in human resource management...
A SHRM-recognized master's degree in human resource management
- Time: 61% of graduates finish this program within 18 months.
- Tuition: $4,755 per 6-month term
- Courses: 10 total courses in this program
Skills for your résumé that you will learn in this program include:
- Performance Management
- Communication
- Management
- Planning
- Talent Acquisition
- Human Resource Information System (HRIS)
Earn your M.S. in Human Resources and help companies create excellent cultures.
How Much Does a Compensation Analyst Make?
$68,024
The median pay for compensation analyst in 2022 was $68,024 annually, according to Payscale. Analysts tend to earn the highest salaries in the professional scientific and technical service industries, followed by management companies and government agencies.
What Is the Projected Job Growth?
8%
Human resource roles, in general, are projected to grow 7% in the next 10 years, while compensation and benefits roles are projected to grow 8%, according to the U.S. Bureau of Labor Statistics. The industry, and this role specifically, outrank the national average of job growth for all jobs. As organizations continue to offer competitive compensation packages to attract top talent, there will be an increase in opportunities for compensation analysts.
SKILLS
What Skills Does a Compensation Analyst Need?
Compensation analysts are extremely data driven and detail-oriented in their roles. Analysts should have a strong ability to compare and process data into a digestible format for their organization. They should have a high level of respect for compliance and confidentiality, and take an interest in effective communication.
According to the Society for Human Resource Management (SHRM), compensation analysts also need:
- Extensive knowledge of quantitative and qualitative research methods.
- Extensive knowledge of human resource laws, regulations, and best practices.
- Excellent written and verbal communication skills.
- Excellent organizational and time management skills.
- Proficient with Office Suite software, particularly Excel.
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