Frequently Asked Questions
Find answers to common questions about salary data, compensation research, pay negotiation, and career planning.
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Understanding Salary Data
Where does salary data come from?
The most authoritative salary data comes from the Bureau of Labor Statistics (BLS), specifically their Occupational Employment and Wage Statistics (OEWS) program. This program surveys over 1.1 million establishments annually to produce employment and wage estimates for more than 800 occupations. Other reliable sources include the U.S. Census Bureau, company-reported data on job sites, and professional association surveys. We primarily use BLS data because it provides the most comprehensive and statistically validated salary information available.
What is the difference between mean and median salary?
Mean salary is the average calculated by adding all salaries and dividing by the number of workers. Median salary is the middle value when all salaries are arranged from lowest to highest, meaning half of workers earn more and half earn less. Median is often more useful for salary research because it is not skewed by extremely high or low outliers. For example, if a few executives earn millions, the mean would be artificially inflated, but the median would better represent typical worker earnings.
What do salary percentiles mean?
Salary percentiles show how wages are distributed across a profession. The 10th percentile means 10% of workers earn less than that amount, while the 90th percentile means only 10% earn more. The 25th percentile is often considered entry-level pay, the 50th percentile (median) represents mid-career earnings, and the 75th percentile typically reflects experienced professionals or those in high-cost areas. Understanding percentiles helps you benchmark where you fall within your profession.
How often is salary data updated?
BLS Occupational Employment and Wage Statistics are updated annually, typically released in the spring for data collected in the previous May. However, there is a lag time of about 18 months between data collection and publication. Private salary databases like Glassdoor or Levels.fyi may have more current data but can be less statistically reliable. For the most accurate research, consider multiple sources and account for inflation when using older data.
Why do salary estimates vary between different websites?
Different salary websites use different data sources, methodologies, and sample sizes. BLS data represents comprehensive statistical surveys, while sites like Glassdoor rely on self-reported data which can skew toward certain demographics. Indeed and LinkedIn may weight recent job postings differently. Some sites include total compensation (bonuses, equity) while others show base salary only. Always check what the salary figure represents and the source methodology when comparing across sites.
Salary Research & Comparison
How should I research salaries for a specific job?
Start with BLS data for a baseline understanding of the occupation. Then check multiple sources including Glassdoor, LinkedIn Salary, PayScale, and Levels.fyi (for tech roles). Consider the geographic location, company size, industry, and your experience level. For specific companies, look at employee reviews that mention compensation. Talk to people in your network who work in similar roles. Remember that total compensation includes benefits, bonuses, and equity, not just base salary.
How does location affect salary?
Location significantly impacts salary due to cost of living differences and local labor market conditions. A software engineer in San Francisco might earn 50-100% more than one in a small Midwest city. However, after accounting for cost of living, the purchasing power might be similar or even lower in the expensive city. Major factors include local housing costs, state income taxes (ranging from 0% to 13%+), and demand for specific skills in that area. Always compare salaries adjusted for cost of living when considering relocation.
What is a cost of living adjustment (COLA)?
A cost of living adjustment is a salary increase designed to help workers keep up with inflation or compensate for location differences. Employers may offer COLA when transferring employees to higher-cost cities, or annual increases tied to the Consumer Price Index (CPI). When comparing salaries between locations, you should calculate what salary you would need in a new city to maintain your current standard of living, accounting for housing, taxes, transportation, and other expenses.
Should I compare base salary or total compensation?
Total compensation provides a more complete picture of your earnings. This includes base salary, annual bonuses, signing bonuses, stock options or RSUs, 401(k) matching, health insurance (which can be worth $10,000-25,000 annually), paid time off, and other benefits. When negotiating or comparing offers, calculate the total value. However, be realistic about variable components like bonuses and equity, which may not always pay out at expected values.
How do I know if I am being paid fairly?
Research market rates using multiple salary databases for your exact job title, location, years of experience, and industry. Consider your company size and funding stage, as startups often pay differently than established corporations. Compare total compensation, not just base salary. If your pay falls below the 25th percentile without a clear reason (like you are new to the field), you may be underpaid. Pay transparency laws in many states now require employers to share salary ranges, making it easier to assess fair pay.
Salary Negotiation
When should I negotiate salary?
Always negotiate when you receive a job offer, unless the initial offer already exceeds your expectations. The best time to negotiate is after you receive a written offer but before you accept. For raises, the best times are during performance reviews, after completing a major project, when taking on new responsibilities, or when you have a competing offer. Never negotiate before you have an offer in hand, and avoid negotiating multiple times for the same position.
How much should I ask for in a salary negotiation?
Research market rates and know your worth before negotiating. A reasonable counter-offer is typically 10-20% above the initial offer, depending on how the offer compares to market rate. If the offer is already at the 75th percentile for your role and location, there may be less room to negotiate. Always have data to support your request, such as salary surveys, your specific accomplishments, or competing offers. Consider negotiating other benefits if the employer cannot increase base salary.
What if the employer says the salary is non-negotiable?
Many employers claim salaries are non-negotiable, but often there is flexibility. If truly non-negotiable on base salary, negotiate other components: signing bonus, earlier performance review, additional PTO, flexible work arrangements, professional development budget, title, or start date. Some companies have rigid pay bands but can place you at a higher level or approve exceptions. Ask what it would take to earn a higher salary and get specifics on the path to advancement.
Should I reveal my current or expected salary?
In many states and cities, employers are now prohibited from asking about salary history. Even where legal, you are generally not obligated to share this information. Instead of revealing your current salary, redirect to your salary expectations based on market research. If asked for expectations, provide a range based on your research rather than a single number. The bottom of your range should be a salary you would genuinely accept, and the top should be justifiable with data.
How do I negotiate a raise at my current job?
Document your accomplishments, especially those with measurable impact like revenue generated, costs saved, or efficiency improvements. Research market rates to show that your current pay is below market. Schedule a meeting specifically to discuss compensation, not as an add-on to another conversation. Present your case professionally with data, not emotions or personal financial needs. Have a specific number in mind and be prepared to discuss a timeline or alternative benefits if an immediate raise is not possible.
Career & Compensation Planning
How much should salary increase with experience?
Salary typically increases fastest in the first 10 years of a career, then plateaus unless you move into management or specialized roles. Entry-level to mid-career (0-5 years) often sees 5-10% annual increases. Mid-career to senior (5-15 years) might average 3-7% annually. Beyond 15 years, increases depend heavily on promotions and role changes. Industry matters significantly; tech and finance often see steeper growth curves than education or non-profit sectors.
What is the salary difference between job levels?
Typical salary increases between levels range from 10-25% depending on the industry and company. For example, moving from Software Engineer to Senior Software Engineer might be a 15-20% increase, while Senior to Staff or Principal could be 20-30%. Management transitions often bring larger increases. However, some companies have overlapping salary bands where a top-performing mid-level employee might earn more than an underperforming senior employee.
Should I change jobs to increase my salary?
Job changes typically result in larger salary increases than internal promotions, averaging 10-20% compared to 3-5% for annual raises. However, consider the full picture: you may lose unvested equity, tenure-based benefits, and relationships that support your work. Frequent job-hopping (every 1-2 years) can raise red flags for employers. A balanced approach might be staying 2-4 years to demonstrate impact, then moving if internal growth opportunities are limited.
How do certifications affect salary?
The salary impact of certifications varies widely by field and credential. High-value certifications like CPA (accounting), PMP (project management), or cloud certifications (AWS, Azure) can increase salary by 10-25%. However, many certifications have minimal salary impact and are better viewed as learning opportunities. Research the specific salary premium for any certification before investing time and money. Industry-recognized certifications from major vendors typically have the highest ROI.
What is the salary difference between remote and in-office work?
Salary policies for remote work vary significantly by employer. Some companies pay the same regardless of location, while others adjust pay based on the employees home location. Location-adjusted remote salaries might be 10-30% lower for employees in low-cost areas compared to headquarters rates. However, the total financial picture may still favor remote work when you factor in eliminated commuting costs, no need to live in an expensive city, and potential state tax differences.
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