ISM Issues Report on Salaries of Supply Management Professionals

Inaugural salary survey by Institute for Supply Management yields data on total compensation and confirms education- and gender-based salary differences.

-- Supply Chain Management Review, 6/16/2006

TEMPE, Ariz.— The Institute for Supply Management last month released analysis of its first comprehensive salary survey. The summary report, "2006 ISM Salary Survey Results," is available to the public and a detailed report is available to ISM members and available for purchase by nonmembers at www.ism.ws.

ISM surveyed supply management professionals in the United States during January and February 2006, achieving a 14 percent response rate. Information on salary, bonuses and stock options was gathered from a total of 1,223 respondents and examined through multiple breakdowns including job title, years of experience, education level, certification status and buying responsibility.

ISM's salary survey established average salaries (for the 2005 calendar year) for the following job titles:

• Chief Purchasing/Supply Management/Sourcing: $161,082
• Vice President, Purchasing/Supply Management/Sourcing: $158,256
• Director, Purchasing/Supply Management/Sourcing: $120,401
• Manager, Purchasing/Supply Management/Sourcing: $80,519
• Agent, Buyer, Senior Buyer, Planner, Purchaser: $57,081
• Consultant: $112,100

Additional summary report details include:

• Average annual compensation of supply management professionals for 2005 was $78,470. Fifty-eight percent of all respondents reported earning bonuses and the average bonus received was $12,483 (reported average annual compensation included bonuses).
• Average annual salary increases as the number of employees in the organization increases ($64,484 in organizations with fewer than 100 total employees versus $87,313 in organizations with 5,001 or more total employees).
• Twenty-five percent of top executives reported receiving stock options and bonuses.
• Average salary varies by industry ($94,227 for respondents in the mining sector, $78,277 for respondents in the manufacturing sector, $89,350 for respondents in the accommodation and food service sector). The lowest annual average salary ($61,587) was reported by respondents employed in the educational services sector.
• Women lag behind their male counterparts. The average salary for women was $66,032 and the average for men was $86,662. And, though male and female executives both report receiving stock options (15 percent male and 13 percent female), there is a distinct disparity in the value of those stock options ($13,720 according to female respondents versus $37,060 according to male respondents).
• Average salary is higher for those with some form of professional certification ($80,758 average salary for supply professionals holding one or more certifications versus $76,411 for respondents who are not certified). Supply professionals with the Certified Purchasing Manager (C.P.M.) designation command some of the highest salaries ($83,172 average) among those holding certification.

ISM will benchmark future salary and compensation surveys against this initial endeavor. "One beneficial outcome of a study such as this is that it identifies issues that can be examined through a prism of past as well as present realities of the profession," says ISM CEO Paul Novak, C.P.M.

A Summary Report "2006 ISM Salary Survey Results" is available to ISM members and nonmembers. A 14-page full report is available free of charge to ISM members and can be purchased online for $199 by nonmembers. For further information visit ISM at www.ism.ws.