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Friday, September 16, 2016

Where do Salary (.com) and PayScale (.com) get their data?



Where do Salary (.com) and PayScale (.com) get their data?


It seems significantly off when comparing to the US Bureau of Labor Statistics. For example, salary and payscale say a computer systems analyst earns an average of $65k annually while the US BLS says about $80k. I kept geography in mind when doing the comparison.
Glassdoor also has similar numbers to payscale and salary(dot com). Which is more reliable? I know glassdoor gets their numbers from contributors but could it be that people with lower salaries are more likely to post reviews? - I don't know.
I would assume the BLS is the most reliable source and safe to reference when negotiating salary, especially if countered with data from salary or payscale.
**One thing I did notice is that the BLS uses median salary while the other sites use average. From statistics 101 we know that median is a more reliable indicator so why do these other sites use average?

Payscale get their data from individuals who fill out their survey and disclose their salary.  

It's possible that people lie when filling out the survey (although Payscale say they have algorithms to deal with this); and in any case, I'm not sure people would be hugely motivated to consistently lie in the same direction.

What's probably more important is the sample of people who fill out Payscale's survey.  You fill it out because you want market data for your job - presumably (for most people) because they want to start a conversation with their boss about a raise.  Maybe those people are younger, lower on the career ladder, and lower paid than the norm - which means the salaries on their database are lower than other sources?


The salary information available from PayScale are gathered/collected through a survey participated freely by anyone interested to share their salary for the common good (i.e. others to have a ballpark figure when researching about salaries based on location, job, position, education, experience, and company).

So as an MBA I typically don't obsess about the actual figure displayed by a service like that. For one, they're not going to give you the"whole picture" unless you either subscribe to their services (*cash register sound!*) or jump through a bunch of hoops and allow them to cram as many ads on screen as possible.

Rather, I pay attention to the trends that those sources show.

For instance, if I know what the market in one place is, like the salary range for a Sr. Developer in the Tampa Bay area, then I can reasonably figure out what the same range is for another region based on what Salary or Payscale show. Using small and round numbers, if that range is $100 annually in TB and the posted annual salary in Seattle is $120, then I can reasonably assume that salaries are about 20% higher in Seattle. Of course I can't say that definitely all salaries are 20% higher in that region, but at least I now have a reasonable ballpark to start from. There are other factors that could play into things as well, but those are typically industry-specific and/or a bit too focused to be broadly applicable.

Actually, a decent indicator is the lowest common denominator position that you can find. So if you can find listings for something like a "fast food server" you can figure out a much better across-the-board-applicable factor for your calculations. At least then you'll have a good baseline factor that will give you a minimum difference in your calculations.
From self-reported answers or real employees.
Often times open posted positions.

They get info from people that submit their personal salaries

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