Why Cost Of Living Comparison Should Drive Your Salary Decisions
By: Sutton Turner August 31, 2020
It’s extremely difficult to hire the best candidates if you are not paying the market rate for their role. At Vanderbloemen, we want to help our clients find and keep the best staff which is why we are now providing Christian organizations with customized cost of living data based on budget and attendance.
Over the last 18 months, we have gathered over 5,000 points within our church database to provide resources that will help you understand the salary based on location and cost of living.
One of the greatest factors influencing cost of living across the United States is driven by the cost of housing. As shown in the diagram below, the cost of living can fluctuate from $134,400 in Jackson, Mississippi, to $790,200 in Costa Mesa, California. This shows just how important it is to adjust salaries based on the cost of living.
So what is the salary amount for a Senior Pastor leading a 500 member church? Many people assume that is a pretty easy question. The largest factor in determining the salary of a position once you know the size of the church with either attendance or budget, is the zip code. Why? Because the cost of living drives so much of the salary differences across the country.
Here’s a good example. Let’s say we have a Senior Pastor making $75,000 per year in Houston (TX), and there are three other senior pastor roles in Costa Mesa (CA), Jackson (MS), and Arlington (VA). All of these churches have the same attendance and budget. Without factoring cost of living by zip code into the equation, you could assume that since these positions, attendance, and budget amount are the same, then the salary would be the same.
In reality, here’s a more realistic portrait of that scenario:
In Costa Mesa, you need to pay the pastor $103,042.
In Jackson, you need to pay the pastor $62,414.
And in Arlington, you need to pay the pastor $100,319.
Why? It all boils down to the difference in cost of living in all of these locations. Housing is the biggest factor in determining cost of living. In Costa Mesa, California, housing costs will run around $790k. In Houston, Texas, housing costs will run around $185k, and in Jackson, Mississippi, housing costs will run $134k. You can clearly see that you can not pay a person living in Jackson the same as someone living in Costa Mesa because of housing costs. However, housing is only one of the factors included in cost of living. You also need to consider expenses like transportation costs, insurance, taxes, child care, food options, and utilities in different areas.
While it’s easy to assume that you could quickly find and determine cost of living yourself, that may not be the case. Leadership Network’s 2018 salary survey shared that “Most people think their cost of living is higher than others (and that it matters more).” This is why we’ve created our algorithms to provide accurate, self-reported, and unbiased data points.
Within all of Vanderbloemen’s salary data, we have collected each salary survey from churches based on their zip code and cost of living. Then we have adjusted these individual data points to compare them to your church’s cost of living. So you do not need to make any adjustments to the data you receive from Vanderbloemen.
Factoring cost of living into your staff salaries is necessary for attracting and retaining the right staff members. Understand how your compensation plan compares to other similar churches in your area and around the country with our unrivaled compensation tool.
If you are a current Vanderbloemen client within the last 3 years, you can email us to submit as many positions as you like for free compensation reports that automatically account for cost of living.
If you are not a current Vanderbloemen client, you can click here to pay $1,000 for the same data on unlimited positions.
Whether you're a church, school, nonprofit, family office, or values-based business, we're ready to help you pay your staff well.