Although numerous segments of the United States economy are on the road to recovery, including the industrial sector, which has posted strong gains over the last year, industry salaries and compensation rates are still feeling recessionary effects. In fact, salary conditions in some industries have actually gotten worse in 2010, despite broad improvements in the economic outlook.

According to IndustryWeek's 2010 Salary Survey, released in February, the average salary for manufacturing managers this year was $98,120, up slightly from the $95,248 reported in 2009. However, 22 percent of the 1,259 U.S. managers surveyed reported salary cuts in the past 12 months, compared to 4 percent last year, and 49 percent said their base salaries had been frozen, versus 27 percent who said the same thing last year.

"Clearly the economy has taken a toll," IndustryWeek says. "Indeed, asked to name the biggest challenge facing the manufacturing industry, one respondent's answer — 'pure and simple, it's the economy' — echoed the sentiments of many."

Managers in the chemicals industry had the highest average salary ($133,077), following by pharmaceuticals and health care ($117,742), petroleum and coal ($115,740) and computer equipment ($107,510).

In terms of geographical differences, states on the Pacific coast had the highest average salary ($126,110), followed by the Mountain region ($101,682), the South Central states ($100,350) and the Mid-Atlantic states ($100,008). States in the Northern Midwest reported the lowest salary at $92,202.

Although salary trends remain challenging for most manufacturing professions, average compensation rates in the supply chain, tracked by the Institute for Supply Management (ISM), have continued to increase each year.

In ISM's 2010 Salary Survey, released this month, the average annual salary reported (including wages, bonuses and other income before taxes) among 973 supply chain managers was $98,200, slightly up from $98,117 the previous year. While the average salary for male respondents fell from $106,679 in 2009 to $104,443 in 2010, women's salaries offset the decline, rising from $84,090 to $88,078. In total, 34 percent of respondents earned salaries of $100,000 or more.

The average supply-chain salaries by job title, according to ISM's report, are:

• Chief of Purchasing/Supply Management/Sourcing — $240,408
• Vice President of Purchasing/Supply Management/Sourcing — $226,562
• Director of Purchasing/Supply Management/Sourcing — $132,398
• Manager of Purchasing/Supply Management/Sourcing — $94,384
• Experienced Supply Management Professional — $71,348
• Entry-Level Supply Management Professional — $50,506

Compared to compensation rates in 2009, all positions had an increase in average salary with the exception of Chief of Purchasing/Supply Management/Sourcing, which declined from last year's average of $256,560.

Geographically, the highest paying regions were the East South Central (Ala., Ky., Miss. and Tenn.) with $112,439; New England (Conn., Mass., Maine, N.H., R.I. and Vt.) with $106,841; and the Mid-Atlantic (N.J., N.Y. and Pa.) with $105,561. The lowest average salary of $92,280 was found in the East North Central region (Ill., Ind., Mich., Ohio and Wis.).

Bonuses were earned by 57 percent of supply chain professionals, with the average bonus totaling $18,504, or approximately 20 percent of the gross salary received. The highest bonus reported to ISM this year was $370,000. Twelve percent of respondents earned stock options with an average dollar value of $26,533.

According to the 26th Annual Salary Survey from Logistics Management, published in March, the median salary for logistics professionals remained stagnant at $80,000 for three consecutive years until rising to $85,000 in 2009 and then to $88,000 in 2010. This year, the average raise was 4.8 percent among the 25 percent of logistics workers who received one.

"Our survey also confirms that U.S. business continues to place a high value on logistics and supply chain talent — and the feeling is mutual, say respondents," Logistics Management writes. "Logistics and supply chain job satisfaction is staying on an even keel, with 60 percent of respondents saying they're happy with their current situation..."

Education level remains one of the key factors in salary advancement. The Logistics Management report found that supply chain professionals with a high school degree earned an average of $67,637, while those with some college education earned $81,830. Those with a bachelor's degree earned $100,800 and pros with an MBA made $137,486.

Experience is an equally important criterion for income. According to ISM, supply chain professionals with less than five years' experience earned an average salary of $72,908, those with six to 10 years' experience earned $83,561 and those with 11 to 20 years' earned $102,119. Those with the most experience — 21 years or more — had an average salary of $106,937.

Despite the challenging landscape for industrial salaries, compensation for the supply chain workforce remains competitive. Both education and experience continue to be the leading factors in salary rates, as focusing on these two elements is the best way to improve one's compensation level.

Earlier: 2009 Supply Management Salaries

Resources

IndustryWeek's 2010 Salary Survey: Down but Not Out
by Jill Jusko
IndustryWeek, Feb. 7, 2010

ISM's 2010 Salary Survey Results — Summary
Institute for Supply Management, June 9, 2010

26th Annual Salary Survey: Retain, Reward, Replenish
by Patrick Burnson
Logistics Management, March 2010