PayScale Releases Third Quarter 2011 Compensation Index

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The Q3 PayScale Index shows Energy and High Technology wages recovering while Construction and Hospitality continue to suffer; Seattle, San Francisco, Boston and Houston are the stand-out cities for improved wages

PayScale, Inc. today announced The PayScale Index for Q3 2011, which tracks quarterly trends in compensation. Specifically, The PayScale Index follows changes in total cash compensation for full-time, private industry employees in the United States. In addition to a U.S. national index, it includes separate indices for the following:

  •     15 private industries as defined by the North American Industry Classification System (NAICS)
  •     20 largest metropolitan areas, as defined by the Office of Management and Budget (based on the July 1, 2009 population estimates by the United States Census Bureau).
  •     3 company sizes: Small (under 100 employees), medium (between 100 and 1,500 employees) and large (greater than 1,500 employees).
  •     19 job categories, as defined, in part, by the Standard Occupational Classification (SOC) system

In the last 12 months, through Q3 2011, only six of the 20 metros have had wage increases of 1 percent or more. They are Seattle (1.9 percent), San Francisco-Oakland-Fremont CA (1.6 percent), Houston-Baytown-Sugar Land TX (1.4 percent), Boston-Cambridge-Quincy MA-NH (1.2 percent), Washington-Arlington-Alexandria, DC-VA-MD-WV (1.0 percent) and Minneapolis-St. Paul-Bloomington, MN-WI (1.0 percent).

"The good news is that some metro areas, particularly those with strong high-tech and energy industries, are starting to see actual wage increases for typical jobs. The bad news is that, in a normal growing economy, for example, back in 2007, we would be talking about 3 percent or higher increases everywhere. The worst performing metro for wage growth in Q4 2007 beats the best metro today," said Dr. Al Lee, director of quantitative analysis at PayScale.

The Q3 2011 PayScale Index highlights include:

  •     Nationally, wages for Q3 were up 0.5 percent over the previous quarter, the largest increase for the U.S. overall since wages hit their peak in Q4 2008.
  •     Energy and high technology (biotech and information technology) industries performed well over the last year, particularly for skilled engineering and similar jobs.
  •     Metro areas with large energy and tech presence led for wage growth: Seattle, San Francisco, Boston and Houston.
  •     Food service and restaurant jobs have seen no increase in pay since 2006.
  •     Retail jobs (dominated by retail salespeople, cashiers, and similar) are at wage levels that are less than 2 percent higher than 2006 wages.
  •     The real estate and rental services industry has still not recovered from the burst of the housing bubble. In Q3 2011, real estate wages fell once again and are now over 1 percent lower than the previous quarter – the worst quarter-to-quarter change of any industry included in The PayScale Index.
  •     The healthcare industry remains a strong player in the labor market. After falling roughly 0.5 percent in 2009 (compared to a national average drop of 1.5 percent), healthcare wages in Q3 2011 have grown to their highest levels in the last six years.
  •     Wage levels for construction jobs are floundering at the bottom of the barrel. In Q3 2011, construction jobs were dead last for wage growth over the last 12 months with wages down 1 percent from a year ago. Wages currently are 7 percent below their peak level, which occurred in Q4 2008. The only good news is that the decline of the last 12 months was the smallest seen in two years.

Adds Lee: "The significant rise of 0.5 percent in the national median pay for all jobs in Q3 2011 is the first glimmer of pricing power by the typical worker since the great recession hit with full force at the end of 2008. Private sector workers' pay is largely determined by supply-and-demand market forces, so this good news won't last without similar good news in employment."

About The PayScale Index
The PayScale Index utilizes a unique approach to trend measurement. Unlike indices such as the Consumer Price Index, which measures the prices of certain goods and services (periodically updated to reflect changes in buying habits of Americans), The PayScale Index uses data on all private-sector, full-time employees working in a given time period.

PayScale has performed a detailed analysis of how various compensable factors, like work experience, education, employment setting and job responsibilities affect pay. This analysis is based on PayScale's extensive data of more than 30 million employee profiles, accounting for 250 compensable factors for 7,000 unique job titles, which show how the pay of actual workers varies with each of these factors.

The PayScale Index also examines quarterly changes in the pay of employed workers across 15 private industry categories separately, 20 metropolitan areas, 19 job categories, and across company sizes of less than 100 employees, 100-1,500 employees, and more than 1,500 employees. Industries include: Arts, Entertainment & Recreation; Business Operation Support Services; Construction; Finance & Insurance; Food Services & Accommodation; Healthcare & Social Assistance; Information, Media & Telecommunications; Manufacturing; Mining; Professional, Scientific & Tech Services; Real Estate; Retail; Transportation & Warehousing/Storage; Utilities; and Wholesale Trade.

About PayScale ( is the leading online provider of employee compensation data. With the world's largest database of individual compensation profiles, PayScale provides an immediate and precise snapshot of current market salaries to employees and employers. PayScale's patent-pending, real-time profiling technology collects and indexes employee pay attributes worldwide and makes this compensation data available through its online salary tools and salary benchmarking reports. PayScale was founded in 2002 and is headquartered in Seattle, Wash. For more information, visit:

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