Our annual U.S. geographic pay analysis of technology and life science industry wages shows the variability in pay rates between locales and areas and demonstrates the importance of considering the impact of geography on pay.

Dividing broad geographic regions of the U.S. into high, mid, and low paying areas highlights the impact of higher-wage locations found within generally lower-wage areas.

It is important to recognize that broad regional geographic data cuts (e.g., Northwest) do not accurately reflect differences between smaller geographic areas and locales. By organizing large geographic regions into smaller geographic areas (high, mid, and low-paying areas) containing locations with similar pay rates, you have a clearer picture of local market pay rates.

For example, by using the data below, one could assume that companies in the general Northwest Region pay employees at an average of 102.7% of the national average. However, this figure does not accurately account for higher-paying metro areas, such as Seattle and Portland, which fall in the Northwest High and Northwest Mid geographic areas. In comparison, we find that companies in Northwest High pay employees at an average of 104.2% of the national average, and companies in Northwest Mid have an average pay rate of 99.9% of national. These average pay rates are not accurately represented by the larger Northwest Region pay rate.

Table 1 displays the Culpepper Geographic Pay Index (CGPI) for different areas and regions in the U.S. The CGPI is calculated from actual employee pay data by zip code collected from participating companies in Culpepper Compensation Surveys.