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Consulting Firms Pay $20,000 - $1,000,000+Compensation in Consulting Firms, 10th Edition - 2005PUBLISHED: April 2005 Summary of the 91-page Compensation in Consulting Firms, 10th Edition - 2005 survey report of 11 benchmark jobs from Abbott, Langer & Associates, Inc. The following describes the highest and lowest paid job characteristics, the national median total cash compensation for 9 more benchmark jobs, and the factors affecting salary (Geographic Area, Type of Service Provided by Employer, Annual Fees, Number of Employees, Type of Work Performed/Supervised/Directed, Experience, Education, Experience Versus Education, and Managerial/Supervisory Responsibility):
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our next Consulting salary survey The composite highest-income practitioner in this field (salary plus cash bonus and/or cash profit sharing) is the President "A" of a consulting firm (defined as a chief executive officer who is the owner of or a full partner or major stockholder in the firm). The firm provides consulting services in employee selection, marketing, management strategy, organizational design/structure/control, government, or information technology; receives in excess of $2,500,000 in gross annual fees; has 10 or more employees; and is headquartered in or near Houston, New York City, Seattle/Everett, Washington (DC), Boston, St. Louis, or Miami, or outside the metropolitan areas studied in Vermont. This individual typically has an undergraduate or graduate degree and 20 or more years of experience. While the median President "A" has a total annual income of $175,000, the highest-income individuals reported in this group make over $1,000,000.
At the far end of the income spectrum (excluding clerical employees), Research Associates have a median income of $38,600. Earning under $20,000, the lowest-paid employees in this group usually are employed by firms providing consulting services in organizational design/structure/control, marketing, or employee compensation/benefits; are headquartered in or near Minneapolis/St. Paul, St. Louis, Seattle/Everett, or Milwaukee, or outside the metropolitan areas studied in Iowa or Maryland; and usually have a bachelor's degree and little or no experience. These composites represent the briefest possible "boil-down" of the voluminous data provided regarding current salaries and cash bonuses and/or profit sharing, and numerous demographic variables provided by 35 consulting firms regarding on over 1,200 employees in 11 benchmark jobs. The end results of the survey appear in Compensation in Consulting Firms, 10th Edition - 2005, a 91-page statistical analysis of compensation in this field. Copies of the report are available for $895.00 through our On-Line Order Form or from Abbott, Langer & Associates, Inc., Dept. NET, 548 First St., Crete, IL 60417 (telephone 708/672-4200; fax 708/672-4674). In addition to the incomes of the benchmark jobs already discussed, the median total cash compensation nationally for some of the other 9 benchmark jobs included in the survey report is:
Naturally, these nation-wide pay rates vary by region, state & metropolitan area, type of services provided and annual fees received by the firm, size of firm, type of work performed/supervised/managed, level of education, length of experience, and supervisory/managerial responsibility involved - all demographic variables for which data are provided in the complete report. Geographic Area The median total annual cash compensation for supervisory/managerial personnel is highest in the northeastern, Pacific, and southern states, and lowest in the midwestern and Rocky Mountain states. The southwestern and north central states fall in the middle of the range. Regarding metropolitan areas alone, the highest median annual incomes reported are found in or near Miami, Charlotte, Boston, Atlanta, San Diego, Chicago, Los Angeles/Long Beach, and Kansas City. The lowest median annual incomes are found in or near Phoenix, Milwaukee, Dallas/Ft. Worth, and Seattle/Everett. Median total annual cash compensation for consultants is highest in the southern and Rocky Mountain states, and lowest in the Pacific and midwestern states. The northeastern, southwestern, and north central states fall in the middle. Regarding metropolitan areas alone, the highest median annual incomes are found in or near Baltimore, Washington (DC), Charlotte, Chicago, Denver/Colorado Springs, and Philadelphia. The lowest median annual incomes are found in or near Cleveland, Albany/Schenectady/Troy (NY), Seattle/Everett, Raleigh/Durham/Chapel Hill, and Milwaukee. Type of Service Provided by Employer Overall, supervisory/managerial staff are paid best in consulting firms specializing in government, marketing, and strategy. It is lowest in consulting firms specializing in human resources and information technology. For consultants, the highest compensation is found in marketing, information technology, and strategy consulting firms. It is lowest in government and human resources consulting firms. Annual Fees This factor is not a good predictor of the median total annual cash compensation received by both supervisory/managerial personnel and consultants. Supervisory/managerial personnel are paid most when annual fees are $5,000,000 to $24,999,999; consultants are paid best when annual fees are $2,500,000 to $4,999,999. Both supervisory/managerial personnel and consultants are paid least when fees are under $2,500,000. Number of Employees This factor is only a fair predictor of median total cash compensation for either supervisory/managerial personnel or consultants. Type of Work Performed/Supervised/Directed For supervisory/managerial personnel, median total annual cash compensation is highest when the type of work performed/supervised/directed is in marketing, health care, or advertising consulting. It is lowest in employee compensation/benefits, information technology, and organizational design/structure/control consulting. For consultants, strategy, systems development & integration, information technology, marketing, education, and employee selection consulting result in the highest median total annual cash compensation, while records management, employee compensation/benefits, and health care consulting result in the lowest. Experience This is a fair predictor of median total annual cash compensation for consultants but not for supervisory/managerial employees. Education This factor is a good indicator of median total annual cash compensation. Supervisory/managerial personnel with a doctorate, for example, were the highest paid ($150,500 -- the MBA degree was very close behind at $150,000), 51% higher than personnel with less than a BA/BS/BBA degree ($100,000). Consultants with a doctorate received $103,152 in total annual compensation, while consultants with less than a BA/BS/BBA degree received $43,050, a 140% difference. Experience Versus Education A combination of experience and education is a better predictor of compensation than either area alone. While dealt with in detail in the report, space does not allow an analysis of the data herein. Managerial/Supervisory Responsibility Median total annual cash compensation varies greatly according to the level of supervisory responsibility. Compensation is highest for supervisory/managerial staff who supervise five to nine professional and sub-professional employees ($196,890), 146% higher than those who supervise only one or two sub-professionals ($80,000). For consultants, compensation is highest with supervisory responsibility for three or four professional employees ($103,279)and lowest with no supervisory responsibility ($55,889), a difference of 90%.
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