As companies expand across multiple locationsโwhether within a single country or globallyโcompensation strategies must evolve to reflect local labor market conditions, cost-of-living trends, and business needs.
Geographic pay differentials allow employers to attract and retain talent while maintaining financial sustainability. But determining how to adjust salaries based on location is a complex decision. Should pay be based on the cost of living, the local cost of labor, or a broader market-based approach?
This guide explains why geographic pay differences exist, common approaches to structuring salaries, and how to determine the best compensation strategy for your companyโs goals.
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