Geographic Salary Differential Studies have long been used by Compensation Professionals and others to gauge, estimate and establish policies for adjustments to Salary Grade Structures between different Geographic Locations.
Comparison of actual salary rates and structures between different locations is the main driver in such studies, however some estimate such differences for certain Benchmark Jobs. This process of estimation often misses the mark in terms of reliability and accuracy.
Reliable Geographic Salary Differential Reports examine not only differences based on salary levels but also Occupation Groupings with the ability to drill down to the Job Family Level. The Bureau of Labor Statistics, ICT/Clayton Wallis and a few other organizations provide such specificity in these Geographic Compensation Comparison Reports.
Over time Salary Structures that have Differentials built-in for Region/Area Differences in Salary and Wages need to be reexamined periodically as Labor Markets change. Labor Markets between Regions, Metropolitan Areas and other locations can and do contract and expand both in terms of employment robustness, occupational opportunities and competitiveness in terms of Total Compensation.
