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Supply Chain News: Purchasing and Procurement Professionals - How Does Your Salary Measure Up in 2018?

 

Annual ISM Survey Finds Compensation Growth Slowed in 2017, While Gap in Pay Between Men and Women Persists

 

June 19, 2018
SCDigest Editorial Staff

The Institute of Supply Management is out with its 13th annual salary survey for procurement professionals for 2018 (based on 2017 data), and the numbers look OK, but with total compensation not growing nearly as fast as last year.

Supply Chain Digest Says...

SCDigest wishes that ISM would dig into the data or find some other way to explain the on-going delta in compensation betwen men and women.

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The average compensation, including salary and benefits, for all participating supply management professionals was $117,425 in 2017, an increase of a modest 1.7% compared to the average found for calendar year 2016. That growth was well down from an average increase of a stron 5% from 2015 to 2016, as well as the robust 7.9% rise seen in 2016 over 2015.

Meanwhile, the median compensation (half above, half below) in 2017 increased 4.2% to $100,000, versus $96,000 in 2016.

Interestingly, the average compensation of the top 10% of earners was $287,420, down 2.9% from $295,887 in 2016. Also sliding was the average base salary of the top 5% of earners in 2017, at $368,505, down 4.5% from $385,981 in 2016.

 

The data set is sizable, so these numbers have some credibility. A random sample of names in the ISM database (including both members and non-members) was selected for the survey. As many as six email invites were sent to solicit participation.

In the end, just under 3000 valid survey responses were achieved. SCDigest will note there might be some upward bias in the survey respondents, as it would seem a person might be more likely to participate if they felt good about their pay and recent changes in it versus those less happy with their situations.

That could bias the average compensation numbers up, but since the same methology has been used each year, the numbers for changes in 2017 over 2016 shouldn't have validity.

The report gets right to it, offering the chart below on average salary (before bonus) by level in the organization, from CPOs and equivalent positions down to supply management newbies.

As can be seen, CPOs averaged about $263,000 in salary compensation, all the way down to over $77,000 in salary for staff early in their supply management positions. And once again, at all levels, women earn less than men, in some cases significantly, continuing a multi-year trend.



 

Source: ISM

 

As we've said in previous years, SCDigest wishes that ISM would dig into the data or find some other way to explain the on-going delta in compensation betwen men and women. Is it discrimination - or something else?

(See More Below)

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As usual, average compensation in procurement varies greatly by what business sector a company is in. As seen in the graphic below from ISM, average salaries among manufacturing related industries were above $154,000 in "non-metallic mineral" firms, versus just $87,000 in wood related products.

 

Average Compensation by Manufacturing Sector

 

 

Source: ISM

 

Outside of manufacturing, salaries for procurement averaged about $109,000 in the retail sector, and more than $113,000 in wholesale companies.

There is a tremendous amount of additional data in the full report from ISM. It is available for free to ISM members, and for purchase at a relatively modest charge for non-members. It can be fund at the link here: ISM’s 2018 Salary Survey

Any reaction to these ISM compensation numbers? Do they seem accurate? Let us know your thoughts at the Feedback section below.

 

Your Comments/Feedback

 
 

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