First, the good news. Salaries for logistics professionals continue to rise, with the average yearly wage now reaching $71,000—nearly double the average salary recorded when Logistics Management first began keeping track 17 years ago. (See Figure 1 below.)

Now, the bad news. Employers aren't rewarding the loyalty of long-term employees. Our survey of nearly 1,000 logistics professionals shows that companies are paying newcomers average salaries that are only $10,000 below what companies are paying logistics pros with more than 30 years' experience—$72,000 on average for the newcomers vs. $82,000 for the long timers. (See Figure 2 below.)

That said, the average salary hike was 7.1 percent last year, an improvement on the previous year's 6.4 percent and a reflection of the tight labor market that resulted from the healthy U.S. economy. This year's economic slowdown will no doubt have an impact on the salaries our survey respondents will report next year.

Although the average salary hike was 7.1 percent, most respondents reported raises well below that. Most of those we surveyed, 55 percent, reported their annual raises amounted to less than 5 percent, while 21 percent reported raises ranging up to 10 percent, and 10 percent of participants received boosts in salary of up to 20 percent. Only a lucky 5 percent reported raises of more than 20 percent. The median raise indicated in the survey results—with half of the respondents falling above the figure and half falling below—was 5 percent. (It is important to note that the reported raises do not necessarily correspond to the average change in salary for the entire survey sample. Raises are self-reported by respondents, while the average change reflects this year's sample vs. last year's, and the respondent pool changes from year to year.)

In a repeat of our findings from last year, our survey shows that job mobility, not loyalty to one company, is the career track to higher pay. In every salary category, about half of all respondents—and in some cases, more than half—said they had been in their current jobs for five years or less. (See Figure 3 below.)

To compile our annual insider's look at logistics careers and compensation, Cahners Research tabulated 973 responses to our annual salary survey questionnaire. About a third of the respondents had previously participated in our survey. Despite the influx of newcomers, the survey results remained consistent with those of previous efforts.

For example, the profile of Logistics Management's readers hasn't changed much over the years. (See Figure 4 below.) The respondents reported a slight rise in their years of logistics experience, from 16 years to 16.4, and years with one company, from 10 to 10.7 years. Years in the current job have dropped slightly, from six years to 5.7 years, while the number of subordinates has jumped from 12.1 to 17 in this year's survey. Average age remains stable, too, at 44.5 years vs. 44.4 in our survey published last year.

The profession also remains overwhelmingly male, 83 percent of our survey respondents, with women earning 71 cents for every $1 paid to men. The average salary for men this year is $74,500, a 7.2-percent average increase over last year's figure. For women, it's $52,900, a 6.4-percent average hike. (See Figure 5 below.)

The $21,600 discrepancy in pay for men and women can be traced to some job differences between the genders. Men, on average, have far more employees reporting directly to them, 19.2. Women supervise only a third as many, 6.5 employees. Men also average more experience, 17.1 years to the 12.5 years averaged by women.

Then, too, the male survey respondents hold higher-level titles than their female coworkers do. Twelve percent of men report that their titles are vice president-general manager, at the top of the salary ladder, vs. only 5 percent for women. Our results show that women dominate the lower-paid position of traffic manager, 32 percent vs. 17 percent for men.

Can women catch up? Time will tell, as more women enter the field and gain the supervisory experience that is paying off for their male counterparts.

Just what is it that the survey respondents do? To no one's surprise, the single biggest job category consists of readers who consider distribution and logistics to be the most important functions assigned to them (32 percent). Another 30 percent said their principal function was traffic and transportation. Supply chain management came in a distant third, at 9 percent; followed by warehousing, 8 percent; purchasing, 7 percent; import-export operations, 7 percent; inventory control, 6 percent; planning, 5 percent; fleet operations, 4 percent; materials handling, 2 percent; and computer systems, 1 percent. But don't let that low figure for computer systems fool you—computer literacy remains a very important part of the job. Asked how important knowledge of information technology was to their ability to perform their jobs, 31 percent of the respondents termed it "essential," 46 percent said it was "very important," and 22 percent judged it "somewhat important." Only 1 percent labeled it "not important."

Even though computer systems brought up the rear in the function ranking reported by our survey respondents, employers clearly find computer expertise a valuable attribute. When functions are ranked by salary levels, computer systems has registered a remarkable 32-percent jump in the past year, going from $62,200 in last year's survey to $81,900, on average. This brings computer systems' salary ranking to the No. 2 position, behind the top-paying function of supply chain management, which averages $88,800. (See Figure 6 below.) Eighty-four percent of those working in computer systems, by the way, report they've been in their present jobs for five years or less.

Although it remains the top-paying function, supply chain management registered a drop in pay for the second consecutive year. In 1999, our survey showed that supply chain management, as a function, paid an average of $96,100. Our 2000 survey showed it paid $92,600. This year's salary for supply chain managers shows a $7,300 decline since the 1999 survey. Although it is hard to determine from the survey results why that's happened, it may be the result of the supply chain concept's success: As more managers are assigned supply chain functions across a broader spectrum of responsibilities, average salaries might exhibit a downward trend.

Our results also showed that seasoned supply chain managers were the most likely to job hop, with 84 percent logging 10 years or less with their current employer. Fifteen percent reported they had worked at the same company for two years or less, 39 percent reported they had been with their companies for three to five years, and 30 percent said they had worked at the same company for six to 10 years. The number drops to only 3 percent for those who've worked at the same company for 11 to 14 years, followed by 3 percent for 15 to 19 years and 3 percent for 20 to 24 years.

Second most-likely to leave are purchasing managers, with 67 percent logging 10 years or less with their current employers. Twenty percent have spent two years or less with their employers, 27 percent have been with the company three to five years, and 20 percent have spent six to 10 years at their current jobs.

It's clear from our survey that what you're called directly correlates with what you make. The top earners, as expected, were the vice presidents and general managers, with average yearly salaries of $114,800. Of this group, 28 percent reported that they earned between $75,000 and $100,000 and 52 percent reported that they earned more than $100,000. (See Figure 7 below.) Here's how some other titles fared:

• Thirty-nine percent of corporate and division managers reported earning $75,000 to $100,000 a year. Forty-five percent reported earning more than $100,000.
• Among logistics managers, 21 percent said they earned $50,000 to $60,000 a year; 18 percent earned $60,000 to $70,000; 10 percent earned between $70,000 and $75,000; 24 percent earned $75,000 to $100,000; and 12 percent said they earned more than $100,000.
• Warehouse managers reported that 31 percent earned $40,000 to $50,000; 23 percent earned $50,000 to $60,000; 12 percent earned $60,000 to $70,000; 13 percent earned $70,000 to $100,000; and 3 percent earned more than $100,000.
• Among traffic managers, 22 percent earned $40,000 to $50,000; 24 percent earned $50,000 to $60,000; 15 percent earned $60,000 to $70,000; 14 percent earned $70,000 to $100,000; and 4 percent earned more than $100,000.
• Assistant traffic managers said that 27 percent earned $30,000 to $40,000; 21 percent earned $40,000 to $50,000; 21 percent earned $50,000 to $60,000; 6 percent earned $60,000 to $70,000; and 21 percent earned between $70,000 and $100,000.
• Fifteen percent of supply chain managers reported earning $40,000 to $50,000; 21 percent earned $50,000 to $60,000; 12 percent earned $60,000 to $70,000; 44 percent earned $70,000 to $100,000; and 12 percent earned more than $100,000.
• Twenty-two percent of private-fleet managers said they earned $40,000 to $50,000; 19 percent earned $50,000 to $60,000; 30 percent earned $60,000 to $70,000; 18 percent earned $70,000 to $100,000; and 7 percent earned more than $100,000.
• Seventeen percent of operations managers reported earning $40,000 to $50,000; 18 percent earned $50,000 to $60,000; 10 percent earned $60,000 to $70,000; 45 percent earned $70,000 to $100,000; and 7 percent earned more than $100,000.
• Twenty percent of purchasing managers earned $30,000 to $40,000; 27 percent earned $40,000 to $50,000; 17 percent earned $50,000 to $60,000; 14 percent earned $60,000 to $70,000; 12 percent earned $70,000 to $100,000; and 10 percent earned more than $100,000.

Regionally, the salary findings tend to mirror overall economic trends. This year, with the exception of New England, the highest salaries were reported on the East and West coasts, where readers from the Mid-Atlantic and Pacific regions reported average salaries of $74,100 and $73,100, respectively. The other regions stacked up as follows:

• West South Central states, $71,900;
• South Atlantic states, $71, 500;
• West North Central region, $70,300;
• East North Central region, $70,100;
• East South Central region, $67,400;
• New England, $66,600;
• Mountain states, $65,500.

As for the employer itself, how much a company spends on transportation annually doesn't have a direct correlation to salaries, our survey found. Companies in the low to mid-range ($1 million to $6 million) pay higher wages than the giants spending more than $20 million a year.

Although the giants had a higher percentage of employees at the top end of the scale (19 percent make $60,000 to $75,000 a year and 26 percent make more than $75,000), the smaller companies spread the wealth a bit better. At smaller companies, our respondents reported:

• 25 percent earn up to $35,000;
• 22 percent earn up to $45,000;
• 24 percent earn more than $60,000;
• 27 percent earn more than $75,000.

What about the industry a manager works in? Some fields definitely pay better than others. Our survey shows that public warehousing offers the highest salaries. Managers working in that sector reported an average salary of $90,000. (See Figure 8 below.) Also faring well in the rankings were transportation services ($81,400) and wholesale trade/nondurable goods ($75,900). Bringing up the rear were fabricated metal products ($58,000) and machinery ($54,200).

Once again, our survey results confirm that the readers who jump from job to job are outpacing others in the profession where earnings are concerned. In fact, when you look at the number of respondents earning more than $50,000 annually, a full 67 percent have been in their current job for five years or less. Logistics has observed this pattern for two years in a row—not quite long enough to make it a trend. Will this continue in a slowing economy or will logistics professionals hunker down in their current jobs and ride out the downturn? For the answer, check this space next April.

Editor's Note: The information appearing in this article represents only a small portion of the data tabulated for this survey. Customized reports are available for a small fee. For information, call (610) 205-1078.

Figure 1.

Salaries have increased by nearly $35,000 since Logistics Management began its annual survey 17 years ago.

Figure 2.

Loyalty is not necessarily rewarded. Those who have spent less than two years at a company earn more on average than those with up to 14 years' seniority.

Furthermore, the gap between those with less than two years at one company and those with more than 30 years is only $10,000.

Figure 3.

Job hopping apparently does no harm to a career. Survey respondents who have been in a job for five years or less earn as much as their longer-tenured counterparts do.

Figure 4.

Except for a steady rise in pay and an increase in the number of subordinates, the reader profile has remained stable during the last 17 years.

Figure 5.

Men continue to outearn women in the logistics field and supervise a greater number of employees.

Figure 6.

Individuals who oversee supply chain management continue to earn more than managers supervising distribution functions do. But computer system supervisors have jumped into the No. 2 position, with a nearly $20,000 salary leap.

Figure 7.

The average pay for vice presidents and general managers is more than twice that of traffic managers.

Figure 8.

Public warehousing continues to pay the top salaries.