Thanks for your responses, Warren! Yes, I completely agree with you that salaries matter a lot. Any good employer should define market-competitive bands and ensure that all employees are paid fairly, and promoted fairly. I wrote a prior post related to this: https://blog.usejournal.com/the-software-engineering-job-ladder-4bf70b4c24f3
Salaries should be managed carefully; I often use the quote “manage salaries as if you had to post them outside your office door” (Mantle). If one employee is unhappy because they are being paid less than their peers and it’s unfair, yes, absolutely fix that immediately. But if your employees are already being paid at a market rate and you want to improve hiring or retention, then raising salaries is one tool along many other tools at your disposal. I say it’s expensive because it needs to be applied fairly to everyone. For example, suppose you’re paying at the 50th percentile and want to pay at the 60th percentile. That works out to be $5k/year more per employee. For 100 employees, that’s an additional spend of $500k/year. It might be your best option! But you’d want to consider other smaller initiatives, too.