In the monthly Glassdoor Local Pay Reports, we examine pay growth trends for 60 different jobs across 10 major metros and the United States. But what’s the connection between pay growth and earning potential?
To find out, we compared two key metrics of pay against each other: the level of pay (i.e., median base pay), versus year-over-year pay growth. Ideally, employees would want to be in the “sweet spot” — jobs that are both high growth and high paying. Jobs like customer service manager, registered nurse, professor and attorney fall into this category.
The figure below shows four categories: high pay, high growth; high pay, low growth; low pay, high growth; and low pay, low growth. It’s based on annual U.S. median base pay for full-time workers, and year-over-year pay growth for 60 jobs from the April 2017 Glassdoor Local Pay Reports.
Source: Glassdoor Local Pay Reports, April 2017. Figures show U.S. estimated median annual base pay for full-time employees.
Overall, there’s a slight negative relationship between pay and growth. Higher paying jobs on average are correlated with lower pay growth. And lower paying jobs are correlated with higher growth rates.
For example, data scientist is among the highest-paying jobs in the U.S. today, with a median base pay of $94,944 per year. However, data scientist pay is only growing at 1.1 percent from a year ago, well below the national average of 2.7 percent. On the contrary, cashiers earn a median base pay of $27,582 per year, but are experiencing rapid pay growth of 5.0 percent year-over-year.
But it’s important to note that not every job follows this pattern. Some jobs have both high pay and high wage growth, while others have both low pay and low growth. The figure above is divided into four quadrants to illustrate both these general trends and the outlier jobs.
Sweet Spot Jobs: High Pay + High Growth
The upper right corner shows the “sweet spot” of jobs with high pay and high wage growth. Most of these jobs require skills that can only be obtained through technical training or higher education. Examples of these jobs include registered nurse, attorney, and software engineer. Professor had the most favorable combination of pay and growth rate in April with an average salary of $90,007 per year and 5.8 percent pay growth from last year.
Accelerating Jobs: Low Pay + High Growth
In the upper left corner of the figure are jobs with low pay and high wage growth. Lower paying jobs in the retail sector as well as some lower paying professional jobs are experiencing strong pay growth today. These include bank teller, warehouse associate, and cashier jobs. Despite the ease of entry into these positions, strong demand for these workers is driving wage growth up to as high as 6.9 percent (for recruiters) over the past year.
Steady Jobs: High Pay + Low Growth
Shifting to the low growth spectrum, the lower right corner shows jobs that pay well but just aren’t growing quickly. These are commonly found in the technology, engineering, and professional service sectors who have experienced fast wage growth in recent years, but appear to be flattening out. These include jobs like data scientist, java developer, and tax manager. Notably, average salaries for design engineer and web developer actually fell slightly compared to a year ago. While many factors are driving this trend, some of this pay stagnation in fast-growing tech roles may be due to an influx of new workers gaining skills from popular bootcamp-style training programs.
Declining Jobs: Low Pay + Low Growth
Finally, in the lower left corner are jobs that both pay less than the average salary and are experiencing very low or stagnant pay growth. Many of these jobs are found in the manual labor sector. These include jobs like maintenance worker, construction laborer, and technician. With the ever-increasing effects of automation, manual labor jobs may be showing early signs of weakening demand from employers. For these workers, the key to reigniting pay growth is cultivating new skills and training to help them stay abreast of technological advances — and to team up with automation to raise wages, rather than risk being replaced.
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