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Tom Farmer explains how to create a simple salary structure using employee data such as name, job title, grade, function, salary, evaluation score, and market value. He emphasizes the importance of matching jobs to survey data, not individuals, as multiple people can share the same job title. The market analysis has already been completed, providing all necessary information for developing the structure. The data is fictitious and for illustration purposes only. The relationship between jobs and employees is one-to-many.