The findings come from the Metropolitan Benchmark module of the 2003 Mercer Benchmark Database. The 2003 edition of the Metropolitan Benchmark module includes responses from nearly 1,400 mid-sized and large organizations in more than 40,000 locations with more than 778,000 employees, as well as detailed compensation data on 319 nonexempt positions (eligible for overtime pay) and lower-level exempt positions (not eligible for overtime pay). This represents an increase over 2002, when 260 positions were included. Some positions are common to organizations in all industries, such as administrative, clerical, accounting, human resources, communications, information technology, legal, and maintenance jobs. Other positions are specific to the health care, banking, insurance, and manufacturing industries.
The survey data are compiled for nearly 150 different metropolitan areas nationwide. In general, the highest salaries for the positions in Mercer´s survey are found in large cities in the northeast (including New York City and Boston) and in California (including Los Angeles and San Jose). The lowest salaries tend to be found in cities across the southern US in states such as Alabama, New Mexico, and Tennessee.
"As the economy begins to improve, organizations need to become more aware of pay levels in their local areas," says Darrell Cira, a senior compensation consultant in Mercer´s Philadelphia office. "We expect to see a renewed competition for talent, but with less of the unbridled enthusiasm seen in the nineties regarding pay. Organizations will target which jobs to pay more; not all boats will rise."
To assess a position´s pay across geographies, organizations often adjust a national market value using broad-based salary differentials for a specific city. According to Mr. Cira, this approach is appropriate for adjusting pay structures and for broadly understanding how pay differs by location to help formulate pay policy. However, he notes, it can result in significantly overestimating or underestimating the local market value of specific positions. Companies sensitive to salary differences in local markets can avoid losing good talent as a result of underpaying employees, and can better manage their compensation costs by not overpaying.
Factors such as the local labor market, demand for job skill, and composition of the talent pool play a role in determining how much a position is paid, as well as which positions are paid more within metropolitan areas. An intermediate accountant (which typically requires a bachelor´s degree in accounting and two to four years of experience) is a case in point. At $43,400 nationally, average base pay for this position is comparable to that for the executive secretary ($44,100). However, in Seattle, Wash., an executive secretary is paid 4.5% more than an intermediate accountant ($44,500 vs. $42,600, respectively), while in Tampa, Fla., an executive secretary is paid 11% less than an intermediate accountant ($40,900 vs. $45,400, respectively).
The Metropolitan Benchmark module, or any other module of the 2003 Mercer Benchmark Database, can be purchased from Mercer online at www.imercer.com or by calling 800 333 3070.