U.S. BUREAU OF LABOR STATISTICS COMPENSATION AND WORKING CONDITIONS

Page 1

It Pays to be the Boss--Supervisory Wages in the National Compensation Survey,

2009

by James E. Smith

Bureau of Labor Statistics

Originally Posted: January 21, 2011

This article uses National Compensation Survey data to illustrate differences in annual wages for team leaders and first-line,

second-line, and third-line supervisors in the United States and in the Census Divisions.

Data from the National Compensation Survey (NCS) show that the pay of team leaders and supervisors increases as their

position in the corporate hierarchy rises. For example, team leaders of engineers in the United States averaged $106,833 per

year in 2009, while first-line supervisors averaged $117,756, second-line supervisors averaged $131,074, and third-line

supervisors averaged $160,554. Similar patterns can be seen for a number of other management jobs that include varying

levels of supervisory responsibility. These jobs share another characteristic--their pay is typically higher than that of all but

the most highly paid nonsupervisory workers in the same occupation. Team leaders of engineers averaged 23 percent higher

than nonsupervisory engineers, who averaged $87,162 per year.

Annual earnings for different supervisory levels of managers are published by the NCS for the United States and for the nine

Census Divisions. This article uses the 2009 NCS earnings estimates to highlight earnings differences among the

supervisory hierarchies in civilian, private, and State and local government establishments. The article also analyzes the

differences in supervisory pay among the nine Census Divisions. All data referenced are for full-time workers. The article also

includes a comparison of 2009 supervisory data with 1997 data that was analyzed in a previous study published in 2000.

The NCS, which provides comprehensive measures of occupational earnings, compensation cost trends, the incidence of

benefits, and benefit plan provisions, publishes an annual national bulletin on the occupational earnings of civilian workers--

defined by the NCS as those who work in private industry and in State and local government establishments.1

The NCS has published national data on the occupational earnings of the various supervisory levels of management workers

annually since the 2006 survey year.2 (Prior to 2006, a different classification methodology was used and supervisory

earnings were not published.) The most recent data, for the 2009 survey year, include weekly and annual earnings estimates

for managers, who are classified as team leaders and first-, second-, and third-line supervisors. Both the mean and median

earnings, plus mean hours, are shown for the civilian sector (private industry and State and local government combined),

private industry, and State and local government. Relative standard errors are available for each estimate.3

Determination Of Supervisory Level

The NCS evaluates each surveyed job for work level, which is a classification of duties and responsibilities performed by the

worker. In the NCS, occupations are evaluated for work levels 1 (the lowest) through 15 (the highest). Most supervisory

occupations are evaluated based on their duties and responsibilities. A modified approach is used for professional and

administrative supervisors when they direct professional work and are paid primarily to supervise. Such supervisory

occupations are leveled based on the work level of the highest position reporting to them.4

The NCS program classifies supervisors according to their level of supervisory responsibility, regardless of titles: • Team leaders, or lead workers, have the authority to make, coordinate, and review work assignments of employees

performing the same general work as the lead worker on a day-to-day basis. Lead worker responsibilities may involve

solving problems, providing instruction on work procedures, or providing input into performance evaluations. • First-line supervisors direct their staff through face-to-face meetings and are responsible for conducting the

employees performance appraisals.
U.S. BUREAU OF LABOR STATISTICS COMPENSATION AND WORKING CONDITIONS

Page 2

• Second-line supervisors direct the actions of staff through intermediate supervisors. The organizational structure is

divided into multiple subordinate groups that differ as to subject matter and function: there are formal procedures and

administrative controls between supervisory levels and groups. • Third-line supervisors direct the actions of staff through multiple subordinate levels of supervision. The organizational

structure is complex with extensive formal coordination, clearances, and procedural controls between subordinate

supervisory levels and organization sub-divisions.

Earnings Of Supervisors In The United States

Supervisory workers are found throughout the civilian sector. As table 1 illustrates, supervisors in the major group titled

management occupations5 in civilian industries ranged from an average of $75,485 per year for team leaders to an average

of $208,510 per year for third-line supervisors. Table 1 also includes four of the more than two dozen detailed managerial

occupations that were published; these four occupations were selected because they are found in each industry sector

published by NCS.

Table 1. Team leaders and supervisory workers, mean annual earnings, selected management occupations, 2009

Occupation and supervisory hierarchy Civilian Private State and local government

Management occupations

Team leader $75,485 $76,449 $70,770

First line 84,460 84,822 82,640

Second line 118,880 120,212 113,793

Third line 208,510 225,018 88,354

General and operations managers

Team leader 72,143 72,948 69,852

First line 87,179 90,426 69,817

Second line 122,284 123,164 117,471

Third line 234,453 241,588 (-)

Financial managers

Team leader 74,588 73,916 80,794

First line 88,316 88,172 89,928

Second line 120,811 121,722 112,332

Third line 273,767 289,635 (-)

Engineering managers

Team leader 106,833 106,858 (-)

First line 117,756 119,107 108,055

Second line 131,074 131,865 (-)

Third line 160,554 160,554 (-)

Medical and health services managers

Team leader 81,807 84,836 69,135

First line 79,704 80,254 76,860

Second line 122,541 110,598 137,522

A dash (-) indicates that no statistically reliable or otherwise publishable estimate is available for the occupation.

Source: National Compensation Survey: Occupational Earnings in the United States, 2009, table 24, “Civilian supervisory workers: Mean and

median weekly and annual earnings and mean weekly and annual hours;” table 25, “Private industry supervisory workers: Mean and median

weekly and annual earnings and mean weekly and annual hours,” and table 26, “State and local government supervisory workers: Mean and

median weekly and annual earnings and mean weekly and annual hours,” on the Internet at http://www.bls.gov/ncs/ncswage2009.htm.
U.S. BUREAU OF LABOR STATISTICS COMPENSATION AND WORKING CONDITIONS

Page 3

Occupation and supervisory hierarchy Civilian Private State and local government

Third line (-) (-) (-)

A dash (-) indicates that no statistically reliable or otherwise publishable estimate is available for the occupation.

Source: National Compensation Survey: Occupational Earnings in the United States, 2009, table 24, “Civilian supervisory workers: Mean and

median weekly and annual earnings and mean weekly and annual hours;” table 25, “Private industry supervisory workers: Mean and median

weekly and annual earnings and mean weekly and annual hours,” and table 26, “State and local government supervisory workers: Mean and

median weekly and annual earnings and mean weekly and annual hours,” on the Internet at http://www.bls.gov/ncs/ncswage2009.htm. Earnings Of Supervisors In The Census Divisions

The National Compensation Survey also publishes wage data for each of the nine Census Divisions.6 Table 2 compares

supervisory earnings in the nine Census Divisions. Estimates on third-line supervisors, when publishable, ranged from an

average of $177,191 per year in the South Atlantic Census Division to an average of $238,749 per year in the East North

Central Census Division.

Table 2. Team leaders and supervisory workers in the Census Divisions, management occupations, mean and median

annual earnings and mean annual hours, 2009

Census division and supervisory hierarchy Mean Median Hours

New England

Team leader $74,283 $66,880 2,037

First line 86,482 77,530 2,007

Second line 105,192 107,380 2,215

Third line 182,715 190,000 2,211

Middle Atlantic

Team leader 82,543 78,375 1,968

First line 94,735 85,218 2,049

Second line 129,488 112,010 2,094

Third line 220,338 214,999 2,077

South Atlantic

Team leader 77,516 71,760 2,068

First line 81,222 73,499 2,111

Second line 126,201 107,488 2,175

Third line 177,191 165,115 2,155

East North Central

Team leader 73,276 69,009 2,035

First line 79,601 74,075 2,075

Second line 109,587 104,119 2,128

Third line 238,749 265,221 2,266

West North Central

Team leader 74,348 70,081 2,060

First line 75,599 70,533 2,091

A dash (-) indicates that no statistically reliable or otherwise publishable estimate is available for the occupation.

Source: Table 21, “Civilian supervisory workers: Mean and median weekly and annual earnings and mean weekly and annual hours” in each

of the nine NCS 2009 Census Division publications, on the Internet at http://www.bls.gov/ncs/ocs/compub.htm#Division.
U.S. BUREAU OF LABOR STATISTICS COMPENSATION AND WORKING CONDITIONS

Page 4

Census division and supervisory hierarchy Mean Median Hours

Second line 102,877 95,992 2,097

Third line (-) (-) (-)

East South Central

Team leader 70,442 66,787 2,061

First line 68,080 66,300 2,097

Second line 108,517 90,481 2,130

Third line (-) (-) (-)

West South Central

Team leader 65,533 58,074 2,004

First line 85,833 78,252 2,130

Second line 119,380 105,435 2,118

Third line 235,959 163,971 2,014

Mountain

Team leader 80,211 81,078 2,118

First line 78,571 77,395 2,104

Second line 126,920 107,801 2,184

Third line (-) (-) (-)

Pacific

Team leader 76,525 71,053 2,082

First line 89,877 84,781 2,064

Second line 121,555 111,259 2,089

Third line 216,827 169,971 2,238

A dash (-) indicates that no statistically reliable or otherwise publishable estimate is available for the occupation.

Source: Table 21, “Civilian supervisory workers: Mean and median weekly and annual earnings and mean weekly and annual hours” in each

of the nine NCS 2009 Census Division publications, on the Internet at http://www.bls.gov/ncs/ocs/compub.htm#Division. Comparison To A 1997 Study Of Supervisors

A previous study similar to this one analyzed unpublished 1997 NCS estimates, which reflect a different methodology in

classifying levels of supervision.7 Despite the methodological differences, some broad comparisons can be made. Chart 1

illustrates the change in annual supervisory pay for management occupations between 1997 and 2009:
U.S. BUREAU OF LABOR STATISTICS COMPENSATION AND WORKING CONDITIONS

Page 5

In 1997, first-line supervisors in the United States classified as executives, administrators, and managers8 averaged $54,558

per year; in 2009, those classified in management occupations averaged $84,460 per year. Second-line supervisors in 1997

averaged $73,070; in 2009 they averaged $118,880. Third-line supervisors averaged $126,714 in 1997; in 2009 they

averaged $208,510.

Conclusion

In 2009, within management occupations in the civilian sector, mean annual earnings for those classified as first-line

supervisors were 12 percent higher than those classified as team leaders. Annual earnings for second-line supervisors were

41 percent higher than those for first-line supervisors; and annual earnings for third-line supervisors were 75 percent higher

than those for second-line supervisors. These ratios were about the same as they were in 1997.

James E. Smith

Economist, formerly with the Division of Compensation Data Estimation, Office of Compensation and Working Conditions, Bureau

of Labor Statistics.

Telephone: (202) 691-6199.

Notes

1 The National Compensation Survey excludes agriculture, forestry, fishing and hunting, private households, Federal Government workers,

and the self-employed. For more information, see BLS Handbook of Methods, chapter 8, “National Compensation Measures,” on the Internet

at http://www.bls.gov/opub/hom/homch8_a.htm.

2 For NCS national earnings archives, see the National Compensation Survey Publications List, on the Internet at http://www.bls.gov/ncs/

ncspubs.htm.

3 National Compensation Survey: Occupational Earnings in the United States, 2009, Bulletin 2738 (Bureau of Labor Statistics, June 2010), on

the Internet at http://www.bls.gov/ncs/ncswage2009.htm. See tables 24, 25, and 26 for weekly and annual earnings and hours; and RSE tables

24, 25, and 26 for the relative standard errors.

4 The NCS determines a work level for each surveyed job using a “point factor leveling” process. Point factor leveling matches certain aspects,

or factors, of a job to specific levels of work with assigned point values. Points for each factor are then totaled to determine the overall work
U.S. BUREAU OF LABOR STATISTICS COMPENSATION AND WORKING CONDITIONS

Page 6

level for the job. For a complete description of point factor leveling, see National Compensation Survey: Guide for Evaluating Your Firm's Jobs

and Pay, (Bureau of Labor Statistics, October 2003), p. 3, on the Internet, at http://www.bls.gov/ncs/ocs/sp/ncbr0004.pdf.

5 Estimates of supervisors wages are published only for workers classified within management occupations, defined by the Standard

Occupational Classification Manual, 2000, published by the U.S. Office of Management and Budget, as code 11-0000, which includes general

and operations managers, financial managers, engineering managers, medical and health services managers, and other categories of

managers. For more information, see “Archived Materials on the 2000 SOC,” on the Internet at http://www.bls.gov/soc/#archives.

6 The nine Census Divisions, and the particular areas that are studied, can be found in the individual publications located at http://

www.bls.gov/ncs/ocs/compub.htm#Division. 7 James Smith, “Supervisory Duties and the National Compensation Survey,” Compensation and Working Conditions, spring 2000, on the

Internet at http://www.bls.gov/opub/cwc/archive/spring2000art2.pdf. The NCS changed from a nine-factor system to a four-factor system with

the September 2005 publications. See Paul Carney, “Converting from Nine Factors to Four in the Occupational Work Leveling System of the

NCS,” September 29, 2004, on the Internet at http://www.bls.gov/opub/cwc/cm20040924yb01p1.htm.

8 The 2000 study analyzing 1997 data used an occupational classification system based on the 1990 Census of Population. That study

presented average hourly rates for full-time executives, administrators, and managers classified as first-, second-, and third-line supervisors

(see table 2 of the Spring 2000 Smith article); the annual earnings cited for this article were computed by multiplying 2,080 hours per year (40

hours per week and 52 weeks per year) by $26.23 per hour for first-line supervisors, $35.13 for second-line supervisors, and $60.92 for thirdline supervisors.

Chart 1. Mean annual earnings, supervisory workers, management occupations, civilian sector, 1997 and 2009

1997 2009

First-line supervisor 54,558 84,460

Second-line supervisor 73,070 118,880

Third-line supervisor 126,714 208,510

U.S. Bureau of Labor Statistics | Division of Information and Marketing Services, PSB Suite 2850, 2 Massachusetts Avenue, NE Washington, DC

20212-0001 | www.bls.gov/OPUB | Telephone: 1-202-691-5200 | Contact Us