has a lot of salary data – in fact, 35 million salary surveys’ worth. While we
like to use it to help both individuals and organizations make salary decisions,
we also employ a really smart economist, Katie Bardaro, who analyzes
our data to take a look back at salary trends. We're pleased to present you with the good news in the newest release of The PayScale Index.
What is The PayScale
Index? The PayScale Index follows the change in salaries of employed US
workers, revealing trends in compensation over time. It specifically measures
the quarterly change in the total cash compensation of full-time private
industry employees nationally, with additional detail on the 20 largest
metropolitan areas, 15 industries, 3 company sizes and 19 job categories. For
full details about how The PayScale Index is calculated, check out the methodology
Great news for the economy – Q3 2012 proved to be
another strong quarter for wage growth. Annual wage growth values are the
highest they’ve been in over three years and this past quarter showed
the strongest growth we’ve seen since 2007. “In today’s economy employers are not really ramping up hiring, but they
want to continue to increase productivity," state Bardaro. "That means they need to incent their
current workers to be more productive and ensure they don’t
lose top performers.”
What other highlights did
The PayScale Index illuminate?
- Energy and
Technology jobs, particularly
highly skilled ones, are the clear winners in the wage growth contest with growth
north of 4% in some instances. If you’re hoping to retain those key energy
or technology employees, you’d better make sure their compensation is
up-do-date in Q4.
- Hiring a tech
employee in Seattle, San
Francisco or Boston? Better check The PayScale Index before you make that offer
because all of these cities experienced wage growth of above 3 percent. In
fact, San Francisco had its strongest quarterly wage growth since being
measured by The PayScale Index (3.6 percent).
- Houston is still hot. After two years of steady wage growth, Houston logs another quarter as the city with the most
wage growth year-over-year.
- Other winners this quarter are in manufacturing – not only did manufacturing
activity expand for the first time since May, but wage growth was the best it’s
been since being measured by The PayScale Index.
- The clear losers in Q3 are jobs related to social service, food service and
legal service with the slowest growth in wages. Though there really are no
losers in Q3 as all measures of The PayScale Index experienced wage gains.
- Small companies
outpaced large companies for quarterly
wage growth. Even with annual wage growth of 3.7% vs. 2.4%, small companies
still lag behind large companies overall in wage growth since 2006, but are
catching up to medium companies. Are you a small
company? Now’s the time to create or review your compensation plan if you hope
to improve productivity and retain employees.
upcoming posts, we’ll highlight the activity in certain industries, cities and
company sizes to help you better understand what The PayScale Index can teach
you about your employees’ salaries past and future.