FAQ Salary Checks
How does Wage Indicator collect the data for the Salary Check?
Wage Indicator collects data by means of a strictly voluntary web-based survey available at national Wage Indicator sites. The Wage Indicator questionnaire is translated into – at present - 20 languages and operates in 60 countries. The survey questionnaire is similar to those used by statistical agencies for standard labor force surveys; it is designed to be easily understood and includes solely multiple-choice questions. The collected data are anonymized, strictly applied measures ensure data security. For more details on our policy safeguarding the privacy and anonymity of our visitors and respondents to the questionnaire, please see our data policy.
Is the wage information in the Salary Check reliable?
The wage information in the Salary Check is calculated using voluntarily collected data and thus, as is the case for other similar surveys, 100% accuracy of the data collected cannot be guaranteed. However, Wage Indicator respondents are encouraged to provide only true and reliable information about their personal and employment characteristics. The Salary Check is regularly updated and improved over time so that it provides the most reliable wage information. In addition before calculation the dataset is cleaned, scientifically checked and benchmarked. In this way we eliminate most non-reliable cases.
How often is the Salary Check updated?
The wage information in the Salary Check is updated regularly. All Wage Indicator Salary Checks are updated at least once a year. In countries with a high response rate, sufficient numbers of reliable observations are collected within shorter periods of time. In such countries the Salary Check is updated more frequently.
What happens with outdated data?
All data are securely stored by the Wage Indicator Foundation, and in most countries they are up-to-date. However, whenever data from the years preceding the current year are used for calculations, state-of-the-art statistical measures are taken to ensure that the age of these data does not affect current results.
What is an occupation? And what is an occupation group?
Wage Indicator recognizes more than 1700 different occupations. Our classification of occupations is based on the International Standard Classification of Occupations (ISCO) provided by the International Labour Organization (ILO). Wage Indicator follows the latest classification ISCO-08 released in March 2008, amending it whenever a more detailed classification is necessary.
ISCO-08 classification is a tool for organizing jobs into clearly defined set of groups according to the tasks and duties undertaken on the job. An occupation is a more narrowly defined job assigned with a 13-digit ISCO-08 code. At the top level occupations are clustered into 10 major occupation groups described by the 1-digit ISCO-08 code.
For example the occupation group Professionals includes these occupations: Biotechnologist, Aircraft engineer, Translator, University professor in social sciences, etc. Each of these occupations is then broken down into more narrowly defined ones, e.g. University professor in social sciences, into sociologist, politicologist, psychologist, and the like.
Is the wage information in the Salary Check controlled for inflation?
Yes. The calculation of the Salary Check adjusts the wage information for the annual inflation rate. For the countries with an exceptionally high inflation rate (e.g. Belarus) we control for inflation on a quarterly basis.
What time period is covered in the data for the Salary Check?
The data in Wage Indicator has been collected since 2006. However the Wage Indicator project was initiated in Netherlands in 2001 and gradually expanded to other countries. Therefore the period covered in the data varies from country to country.
Are overtime and bonuses included?
Yes. We adjust calculations for hours worked. Yet, we do not include any bonuses in the calculation of salaries.
What about the difference between gross and net wages?
The Salary Check calculation uses the gross hourly wage rate computed from gross earnings and the number of hours worked. However, in some countries the proportion of respondents who report only their net earnings is significant. In these cases we use statistical techniques to impute their gross earnings.
Why do I have to answer questions about my personal characteristics?
The aim of Wage Indicator is to provide the most reliable wage information for any specific occupation and worker’s profile. It is well known that personal characteristics significantly affect wages individuals earn. Therefore, knowing these characteristics is essential for the calculation of the statistical rules that assign wages to any occupation and worker’s profile. In fact, these state-of-the-art statistical methods allow us to predict wages even for workers‘ profiles not present in our data. For example, these techniques allow us to predict the wage of a 33 years old plumber even if there is no plumber of this specific age in the dataset.
Why is gender important for wages?
It is a well known empirical observation that men and women earn different wages. While some part of the observed differences can be explained by differences in individual characteristics, such as tenure, another part cannot be explained in this way. The aim of Wage Indicator is to provide the most reliable wage information for any specific occupation and worker’s profile. By providing reliable information about empirically observed gender pay differentials Wage Indicator hopes to contribute to a more transparent and equitable labor market.
Why is education important for wages?
The worker’s wage profiles in the Wage Indicator are also defined by the level of education. In general the level of education determines the productivity of an individual. More educated individuals may be assigned more complex tasks, more responsibility, or are simply using their time at work more efficiently. Differences in educational attainment give rise to wage differentials even within the same occupation and for individuals sharing other characteristics. Therefore controlling for education is crucial for the reliability of our wage information.
Why is tenure important for wages?
In general, more productive workers earn higher wages, and more experienced workers tend to be more productive. The reason is that over the years they have been working they most probably also learned how to perform their tasks more efficiently. However, we typically observe diminishing returns to work experience over time. For example, workers with 20 years of experience may earn 45% more than workers at the beginning of their career, but only 15% more than workers with 10 years of work experience. The workers‘ wage profiles in the Wage Indicator are also defined by their tenure.
Why is it important for wages whether the employee has a supervisory position?
In general a supervisory job carries more responsibility, for which workers in such positions are compensated. Also, typically the most able and productive workers (next to other characteristics) are selected for supervisory jobs. The information about supervisory job is important as it defines the worker’s profile in the Wage Indicator.
What is the meaning of minimum and maximum wages?
Minimum wage is the lowest wage reported in our data for a given occupation (not necessarily identical with the national legal minimum wage, where it applies). Maximum wage is the highest wage reported in our data for a given occupation. As our statistical methods permit predicting wages also outside our sample, it is possible, and correct, that in certain cases the wage predicted by the Salary Check is higher than the reported maximum wage, or lower than the reported minimum wage. For example, if for a given occupation all respondents in the data have between 2 and 12 years of tenure, and the profile entered in the Salary Check involves 28 years of tenure, it is well conceivable that the wage corresponding to this profile is higher than any wage, including the reported maximum wage, observed in our sample.
Is the physical beauty of a person reflected in the Salary Check?
Some researchers explored whether appearance matters in occupations where attractiveness is economically important. They found that the beauty premium does not account for the entire wage premium. In most cases the impact of beauty on wages is overestimated and important measures such as self-confidence, diligence or creativity are neglected. In the current version of the Salary Check appearance is not reflected in the wage information.
My salary is much higher/lower than shown in the Salary Check. How is that possible?
The Salary Check predicts the expected wage for a given profile of individual characteristics. In other words, it answers the question how much can an individual of given characteristics expect to earn. Clearly, the quality of the prediction depends on the accuracy of information entered into the Salary Check. First of all, it is very important to correctly report your occupation. Wage Indicator recognizes more than 1600 occupations and although some of the occupational titles are similar, sometimes they differ substantially in the tasks and duties. If the wage information in the Salary Check does not match your current salary, it is possible that you have not chosen the proper occupation. For example, a logistics worker earns much less than a logistics manager.
We do our best to capture the most important determinants of wages, but clearly, discrepancies between your actual and predicted wage may be due to factors that are not covered by the Salary Check. To illustrate this point, not all female logistics managers with 13 years of tenure and a university degree earn the same salary. If your salary is higher than that reported by the Salary Check, congratulations! You probably have some characteristics, such as outstanding perseverance or talent that are rewarded in the labor market but not known to us. Conversely, if your salary is lower than that predicted, this may mean that you work for a company that pays less, but offers benefits that compensate for the lower pay, such as free kindergarten for your children on the company's premises, or an especially nice team of co-workers. It may also be the case, however, that you are underpaid and might consider looking for another job.
I can't find my profession, how is that possible?
First, please try to refine your occupation search again. Currently the Wage Indicator recognizes more than 1600 different occupations, making it a truly encompassing tool. However if your profession is very specialized and unique within your country it may not be defined in the Wage Indicator yet. In that case, please let us know and we will include your occupation in the Salary Check as soon as possible. Just to get the idea: Wage Indicator registers 20 different specific driver’s occupations.
Can I use the outcome of the Salary Check to make my employer raise my pay?
The aim of the Salary Check is to provide the most accurate information about the expected wage for a worker in a specific occupation with a given set of individual characteristics. However the calculation of wage information in the Salary Check does not include aspects such as self-confidence, diligence, creativity, work attitude, and the like. They are part of your individual human capital and co-determine your salary. Therefore the wage predictions from the Salary Check have a great informative value but can be only part of your input in wage bargaining. But you may certainly try to make your employer raise your pay, referring to your occupational peer group as a benchmark.
How is medium wage calculated?
Median wage is a measure of central tendency in the distribution of wages in the population. It is the value above which and below which half of the cases fall, the wage of the individual for whom it holds that half of the population earns more, and half of the population earns less, than he or she does. I tis also called the 50th percentile and it is not sensitive to outlying values.
How often should I fill in a survey?
We encourage you to fill in the questionnaire once a year. In this way you will greatly enhance our ability to contribute to a transparent and fair labor market.
Why data in a Salary Check differ from official data from the Ministry/Bureau of Statistics?
Wage Indicator data are comparable in quality with those from other surveys, and they respond to the needs of the society more timely, as they are available on the quarterly basis and immediately used for the Checkers. The survey is also more versatile and in some aspects more detailed, thereby providing the possibility to address any new developments in the labor market. However, the survey is not based on a representative sample of the labor force, and therefore no conclusions can be drawn for the population at large. In some countries, groups in certain wage brackets may not visit the Internet as frequently as other groups, for example the very high or the very low paid groups.