Project Management is one of the fastest growing professions in the United States, reflected in the fact that the median salary for American PMs is around $105,000. Numbers can be deceiving, however, especially in this case: the range of the salary of a project manager will vary wildly depending on a few factors most HR professionals don’t know to consider. Here are three aspects of the job description to ponder before doling out six figures to a candidate.
Understanding the Salary of a Project Manager
1. What’s In a Title?
You may not know it, but the Project Management Body of Knowledge (written by the Project Management Institute, the primary certification-granting body in the profession) has actually established levels of responsibility and corresponding job titles to account for the wide range of job descriptions within the discipline. Generally, these titles reflect a gradation of salary levels. For example:
Project Expediter: This is a kind of administrative assistant who works part-time to coordinate project meetings, report project obstacles to management, and supports the creation and dissemination of project documentation. This is generally an entry-level position requiring at least an Associate’s degree, and some on-the-job or educational training in project management principles.
Project Coordinator: A Project Coordinator is the next level of responsibility, and generally has at least 2 years experience. This individual operates more like a “traffic controller” in organizations with multiple projects running at the same time. The position requires an assertive, detail-oriented personality with working knowledge of best practices in project management.
Project Manager: This individual is in charge of managing a project from concept to completion, with or without the support of a Project Expediter or Coordinator. This generally requires at least a Bachelor’s degree or equivalent on-the-job experience, depending on the industry. Many organizations with a high degree of project orientation will create levels of seniority among Project Managers (example: I, II, III) denoting the quantity, scope, and budget of projects managed by the PM. Mid-level and senior PMs start to hit the median publicized by PMI.
Program Manager: A program manager tracks progress and serves as a point of escalation for several related projects (a “program”) whose component projects are likely managed by separate Project Managers. Program and Portfolio managers are senior executive positions that sail past the median salary, especially in project-centric industries like Energy and Software Development.
2. Respect the Matrix.
Part of what makes the range of salaries for PMs so wide is the fact that their degree of direct authority over project teams can be drastically different from company to company. Functional or Weak Matrix organizations give very little authority to the Project Manager—in other words, the PM at this organization will not have any direct reports. This means that they are generally at the lower end of the payscale, but be careful not to take advantage… getting results without formal authority is a rare skill, and worth paying for.
PMs in Strong Matrix or totally Projectized companies will make more, because they are essentially the management front line. A good example is a software development company, whose work is completely customer or project-driven. In order to ensure products are delivered on-time, on-budget, on-scope with a high degree of quality, PMs at these organizations are endowed with more formal authority.
3. What’s Your Driver?
If it is imperative that all your projects finish on-budget, you’ll need a PM with demonstrated ability to manage finances. Generally, the bigger the budget, the more experience you’re looking for. You may need to pay more to find someone with the right background and education. Same is true if you need a PM to manage a large quantity of projects at the same time, or if you need someone with a demonstrated ability to complete projects on time. There are many people out there claiming to be great PMs, but the proof is in the pudding. Situational interview questions, detailed references, and project portfolios are all items to consider making part of your application process.
Do you have Project Managers in your organization? Are they paid accordingly? 71% of current employees cite the #1 reason for leaving a company is their salary. Can you afford to lose good PMs because you’re not paying appropriately? Share your thoughts!