average career salaries

If I could travel back in time and give myself a little bit of career advice, I’d spend some time talking to young Steve about earnings over a lifetime of work, or average career salaries. The median elementary school teacher salary in the US, for example, makes about $51,000 a year.  The median attorney salary is closer to $91,000.  The median auditor is closer to $58,000.  Here is the difference, though:  a median is just a median, meaning that half of the people with that profession make more than that figure, and half make less.

The school teacher population is going to be made up of a lot of teachers making between $40,000 and $51,000 a year – maybe younger teachers, or lower-cost-of-living areas. The other half might make $51,000 to $70,000 or so.  There might be a few outliers in expensive areas – New York or San Francisco – but there will not be teachers making $450,000 a year.  The system is not designed to allow anyone to escape into a significantly higher pay bracket (and we’re talking about teachers, not teachers who become administrators – that’s a different job).

That’s a real difference from some other professions. Take the Big 4 firms – Ernst & Young, Deloitte, PricewaterhouseCoopers and KPMG.  An auditor in a Big 4 firm probably makes less than a schoolteacher to begin with (particularly on an hourly basis).  These lower-level auditors make up the majority of the employees of the firm.  For every partner, there might be five managers, each of whom might oversee ten staff (for example).  So 6 of every 56 people are managers or above, and only 1 in 56 are partners (I made up those ratios, but based on my experience that’s a fair guess).  So the median’s lowered to account for the huge number of lower-level staff.

But in an environment like that, the chance for exceptional rewards for exceptional performance exists. Now, if you’ve worked in a corporate environment or read my last post on stupidification, you know that exceptional performance is not always the requirement for getting rewarded.  Sometimes it’s being the CFO’s nephew.  But as compared to the teachers above, there is a chance that earnings can grow far, far beyond their starting levels.  A teacher can’t, even if they win an award as the greatest teacher in their state.  An outstanding diplomat can’t break out of the government pay grades.

What all of this means is that not only do you have to consider the starting salary for your career, but you have to look at what the possibilities for exceptional earnings are.  I know earnings are not everything.  Many people can also fall into the trap of believing that they will be the exceptional performer, but in a bottom-heavy organization far more people will quit or be fired than will make partner or executive.

So consider average career earnings, and then think about whether you are willing to be the exceptional performer. If you aren’t, maybe the average career earnings aren’t that critical.  If you don’t plan to excel, a career where everyone can be expected to be compensated within a narrow range is fine.  If you do plan to excel, make sure it’s in a profession where that excellence might result in reward.  That’s not to denigrate teaching or praise public accounting.  I realized early on in my career in public accounting I wouldn’t be a partner; I didn’t have the drive to be an exceptional auditor.  So I joined the lower level of the median salaries and might have been happier – and done better over the course of my first 10-15 years of working – had I done a job search and chosen a different career path, with a narrower bank of average career salaries.

Note:  I haven’t read Seth Godin’s Linchpin: Are You Indispensable? yet, but I gather that’s what that book is all about – the idea of making yourself into an “artist,” which Godin believes makes you deeply committed to becoming indispensible to your organization.  Maybe I should read it…

  • http://www.moneyandsuch.blogspot.com Shadox

    Yup. You make a valid point.
    Nisim Taleb in his book “Black Swan” actually makes the opposite point (well not exactly opposite, but contrasting). He says that jobs that offer outsized returns for a small number of outstanding stars (e.g partner at E&Y, major athlete, movie stars) are alluring because everyone thinks they can be the star performer, whereas only a very small percentage actually become Michael Jackson…

    His point is that it’s better to select a job / investment / strategy where the variability in return is not that great and expected return is acceptable.

    In other words, try hitting a single rather than swinging for the fences.

    That’s his opinion. I know I am exceptional… ;-)

  • http://funny-about-money.com Funny about Money

    wait, what? Am I understanding this correctly? “If you don’t plan to excel, a career where everyone can be expected to be compensated within a narrow range is fine.” Surely not…

    Excellence is not measured by how much you earn. Our culture values work irrationally, and so jobs that should be highly paid are devalued and work that is, shall we say, craven, is hugely overpaid.

    One may excel at any number of altruistic careers–teaching and nursing are among them–and not earn what a mediocre lawyer or Wall Street banker earns. One reason for that, of course, is that teaching and nursing have traditionally been “women’s work,” and today’s salaries continue to reflect the long history of underpay for women. Another reason is that the institutions hiring people into this kind of work are usually governments or nonprofits that simply don’t have the budgets to pay fair wages.

    Teachers, interestingly enough, can engineer much higher compensation than the median figures reflect — as you observe in your remark that “median” is not necessarily what an ambitious young person can expect to earn.

    For example, when I was teaching at the university level, I earned $43,000 on a nine-month basis, but my annual income was usually around $80,000. The difference came from teaching during the summer and from leveraging my position as a faculty member to get paid speaking engagements and contract jobs. When I moved over to an administrative position, which entailed FAR less work than teaching, I was paid about $65,000 but ended up with $90,000, simply by moonlighting a couple of courses each semester and again, using my glittery job to market myself for contract gigs.

    In Arizona, where K-12 teachers (like everyone else) are underpaid, $50,000 is the top of the pay scale. No one earns more than that, regardless of seniority or graduate-school credits. However, you can wangle extra pay by taking teacher training, for which many districts give a stipend, and by taking on extra committee work that also can earn extra money. And let’s remember, the 50 grand is for nine months of work. That gives you three months to earn equivalent hourly pay in the real world. Take your piddling pay, prorate it over three months, get corporate job that pays that much (no problem!), and voila! Your pay isn’t $50,000; it’s $66,667.

    • http://www.bripblap.com Steve

      Oh, no, I didn’t mean you couldn’t excel as a teacher. I simply meant that if you WANT to be highly compensated, choose a career where that’s possible. If you want satisfaction in your work or lifestyle or what you’re doing for others, choose a career that speaks to you regardless of compensation – and then excel in it.

      It’s really more a reflection on the way I hear some people grumbling about their low-paying jobs in corporate America; most of the time those are the people who don’t attend training or leave right at 5 or don’t grit their teeth and brownnose. They don’t want to put out the superhuman effort to excel (I know I didn’t after a few years, either).

      But no, I’d never say that earning is the main goal. However, I wouldn’t say that it’s not the main goal of SOME people, either – and those people need to go into careers where huge amounts of effort result in huge compensation. That’s not going to happen as a corporate accountant or as a teacher. It’s probably most likely to happen if you’re a small business owner, actually, but that’s another post.

      And I would add that being a teacher has other less obvious benefits such as tenure, excellent health/retirement benefits, and so on. But again, that’s a different post.

  • http://www.roshawnwatson.com/ Roshawn @ Watson Inc

    Hey Steve,

    I think finding work you love also influences whether or not you become an exceptional performer. For example, if you hate your job, your performance will not likely be at the same level as someone who loves their job. Can you comment on your experience with 48 days to the work you love program and/or book?

  • http://careertoolkits.com Career Toolkits

    I loved your article; you have so much helpful and great information about career salaries.

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