Competencies as determinants of remuneration

Abstract

Purpose: The purpose of this study is to determine how the competencies expected by employers affect the possibility of achieving a wage equal to or above the average wage in the economy. Design/methodology/approach: Achieving the stated goal required a several-step approach. The first step was an analysis of the literature in terms of employers' expectations in the labor market and individual determinants of the salary received. Subsequently, the focus was on obtaining and checking the data (they came from the Human Capital Study -HCS). After this stage, an econometric model was estimated, which, after verifying its correctness, became the basis for analyzing the impact of individual competencies on the proposed salary. Findings: Based on the results of the logit model, it can be concluded that among the competencies that have a positive impact on wages should be distinguished, among others: the ability to operate a computer and specialized computer programs, the ability to assemble and repair machinery and technical equipment, the ability to perform advanced mathematical calculations, cooperation with people of other nationalities, willingness to travel frequently, and willingness to work unusual hours. Research limitations/implications: The main limitation of the survey was data gaps. Some employers were unwilling to state the amount they would offer for the indicated position. Practical implications: Employers have the opportunity to compare what aspects of employee competence, businesses pay attention to, and how they value them. Based on this data, the approach of a particular organization can be verified and adjusted to market conditions. Social implications: Based on the analysis, it is possible to see which competencies are particularly valued by employers. By developing them, employees can increase the likelihood of receiving a higher salary. Consequently, this will contribute to improving their living conditions. These results can also influence job seekers, who, by developing the indicated competencies, can adapt to the requirements of the labor market and thus shorten the job search period. Originality/value: The added value of the article is to show the expectations of employers and their direct impact on the chance of obtaining a high salary. Keywords: competencies, wages, logit model. Category of the paper: Research paper.