THE MAGAZINE

Benchmarks In Compensation

By Mike Moran

Business sector. The survey asked respondents to categorize their employers within one of 12 business sectors defined by the U.S. Department of Labor Bureau of Labor Statistics. (@   Link to those definitions via SM Online.)

When salaries were correlated against business categories, clear distinctions emerged in how different industries compensate security professionals. The natural resources and mining sector posted the highest median compensation of $92,000 in 2004, up a full 9 percent over the preceding year. The information sector placed a close second, with a median compensation of $90,000, which was up 8 percent from 2003. The construction, transportation and utilities, and manufacturing sectors rounded out the top 5 industries with median salaries of $85,000, $80,000, and $80,000, respectively. The largest population in the survey, with 625 respondents, was the professional and business services industry, which reported a median compensation of $76,000.

On the other end of the spectrum, leisure and hospitality, health services, and education were among the sectors offering the lowest median compensations of $68,000, $66,000, and $64,000, respectively. Yet the leisure and hospitality sector is notable as the industry posting the fastest pace of growth in median salaries for security professionals, rising almost 11 percent.

The industry sector where one works is, of course, but one factor and within each is a range of salaries. Consider that the 75th percentile—who made more than all but the top quarter of earners—of respondents in the 12th-ranked education industry is $87,000, while the 25th percentile in the second-ranked information sector is just $66,000.

Company configuration. Respondents were asked a number of questions about the company they work for, including type, number of employees, and revenue.

Type. Respondents noted whether the company was a publicly held company, a private company, a government agency, or a nonprofit. As with sector, the type of company a security professional works for has a limited effect on compensation, but there are patterns that emerge, with those at publicly held companies at the high end and those at local government agencies at the low end.

Median salaries among respondents working for public companies ($82,000) were nearly 10 percent higher than those for respondents working for privately held companies ($75,000). A similar pay gap existed between those working for federal agencies ($82,000) and those in state agencies ($75,000). Respondents working for local government/law enforcement agencies earned the least, with a median compensation of $70,000.

Type of company provides a useful example of the difference between using average salaries, as some surveys do, and median salaries as is the case in the ASIS survey (see box below for more on this). In the federal government, the average is just 7 percent above the median, indicating that the most highly compensated group is tied more closely to the compensation of the entire group.

By contrast, the median compensation in private companies is $75,000, while the average compensation is $87,000—15 percent higher. The higher average indicates the degree of discrepancy between the compensation of individuals at the highest tiers and the rest of the group.

In the above example, it is apparent that there is a greater range of salaries within private sector companies than in federal agencies. Specifically, the top ten percentile within companies receives $25,000 more per year on average than colleagues with federal agencies. Conversely, the bottom ten percentile working for federal agencies earns nearly $12,000 more than their colleagues in the bottom ten percentile of the private sector.

Employees. Although the total number of employees appears to influence the median compensation levels of security personnel in the largest companies, the trend does not continue through the category.

Those working for companies with more than 10,000 employees reported the highest median compensation, at $82,000. This is closely followed by those employed by companies with 5,000 to 10,000 employees, where the median reported compensation was $78,000.

The trend breaks down at lower employee levels, with companies employing fewer than 100 employees earning a median of $77,000, greater than those in the 100-499 category, at $74,000, and those in the 500-999-employee range, reporting just $67,000.

Revenue. The survey shows that it pays to work at companies that are doing a lot of business; the more the company takes in, the better the compensation for the security professional is likely to be.

Median salaries for respondents in companies with revenues exceeding $1 billion are $85,000. That trend continues, though not steadily, through companies with revenues from $500 million to $1 billion ($72,000), $100 million to $499 million ($71,000), $25 million to $99 million ($70,000), and $5 million to $24 million ($65,000).

Like the companies in the preceding category of total employees, the bottom of the revenue range is marked by an upswing in the median compensation, with companies earning a gross revenue of less than $5 million paying security professionals a median compensation of $75,000.

In both the revenue category and the total-employees category, the lowest category (fewer than 100 employees and less than $5 million) was notable by salaries in the 90th percentile being substantially higher than in the categories above. One possible explanation is that in companies of this size, the person charged with the primary responsibility for security is also the president/CEO.

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