ERI's Compensation and Benefits Research: Frequently Asked Questions

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  • "What exactly does ERI do? What is the value of ERI's products to me?"

    ERI's research analysts apply a combined 100+ years of experience in the field of compensation administration to give you interactive software updated quarterly with consensus results from the most reliable survey sources.

    ERI maintains several databases, tracking wage and salary information (as well as cost-of-living information) for the United States, Canada, the United Kingdom, and many European Union members. Data for each country is maintained separately. (Detailed methodologies are available online from the ERI Methodology webpage.)

    ERI's Assessor Series® captures and combines the strengths of the Internet, the privacy and speed of your desktop PC/laptop, and ERI's research since 1987 to provide instantaneous answers to your most pressing compensation questions. For a broader treatment, see our Why Subscribe to ERI? page.

    ERI's goal is to be your organization's compensation research outsource. You can duplicate ERI's calculations if you want to spend the time and resources required to collect, compile, and analyze the thousands of data points that comprise any one city's wage and salary rates, as well as cost-of-living levels. However, subscribers can now spend this time and these resources administering pay and performing the many other duties demanded by today's Human Resource positions.

    ERI researchers save you time and money!

  • "How do I learn to operate your interactive software?"

    ERI offers four types of Assessor Training options. First we offer Online Tutorials on all our software products. Second, we provide training Conference Calls every Thursday. Third, our software contains Help Files accessible by selecting Help at the top of any Assessor screen. Fourth, ERI offers online Technical Support pages. Finally, ERI Distance Learning Center Online Courses teach you how to use advanced features of this compensation software. In addition, you can always call Subscriber Services at 800.627.3697 (US/Canada) or 0800-894-800 (Europe) for further guidance.

  • "How can I keep others from using my ERI subscription?"

    Since these are professional products with confidential information whose application requires specialized training, ERI licenses individual users rather than PCs or organizations, even though the purchasing enterprise designates the assigned licensed user. When you become a subscriber, you will be assigned a License Code unique to you and your specific subscription. Anyone else who tries to install your disk on another computer will be denied access beyond the free demo versions. There are also additional data security methods employed by ERI to guard against unauthorized access to your confidential ERI studies, but only you can control access to your PC.

  • "How do I get my License Code?"

    They are mailed, faxed or issued over the phone to authorized users. Those people identified to ERI as the authorized users of their organization's ERI subscription(s) are regularly and periodically issued with License Codes that specify their identity and reflect their subscription details. Different subscriptions get different License Codes. Different locations require different License Codes. Each user must accept an End-User License Agreement before loading any quarterly update of any subscription; those agreements contain the formal terms of our licenses to access the quarterly datasets. New users are mailed their License Codes, which must be promptly installed to remain effective for the term of their subscription or the calendar year, whichever is shorter. In the event of a computer crash, the user may be notified upon reinstallation of their quarterly dataset that their License Code must be updated. ERI Subscriber Services personnel are available during all regular business hours to provide those License Codes and to assure that only the designated personnel authorized for access to the confidential software are granted those codes.

  • "Where do these numbers come from? How do you compile wage and salary data? Where do you get your cost-of-living data?"

    Salary and Wage Data:

    ERI collects data from thousands of available salary surveys, not just those published by the largest survey firms. We collect available salary survey data for jobs and areas; evaluate each survey for validity, reliability, and use; and compile updated market values for positions with comparable responsibilities.

    Analysis is conducted on wages by geographic area, size of company, years of experience, and industry. Data values are automatically updated to match today's market movement rates, and our default projected market increase projections, like the other variables, can be adjusted at your preference.

    Our subscribers are provided with convenient and easy-to-use market value results: the use of Assessor Series software databases involves choosing a position title and viewing the current market prices. Results are reported according to the predictive variables, and all methodologies are detailed for complete defensibility.

    ERI results are all market based and reflect current market values.

    ERI labor cost data for European Union countries comes from their National Statistics/Labour Offices.

    In cases where no surveys were conducted for a job in a specific city, ERI will use contiguous area wage data in concert with our proprietary economic studies to report wage levels for that job in that location. Contiguous area wage data and economic studies are used only for small areas where limited or no specific wage survey is conducted. ERI wage data is based on the market's price of jobs. Comparable worth concepts and job evaluation concepts differ from market pricing and are not (and have never been) part of ERI's market pricing methodology.

    ERI applies no "magic" with our collection of survey data, creation of a master database, and market value distillations. Subscribers might also produce these results, should they wish to conduct research for decades and spend the time and money collecting the thousands of national and local area surveys now conducted worldwide by consulting, trade, association, private, and government entities. Job matches are confirmed by comparison of the position descriptions compiled for each of the positions found in the Salary Assessor® or Executive Compensation Assessor® software and databases.

    Cost-of-Living Data:

    ERI downloads actual housing sales data from commercially available sources. Gasoline, consumables, medical care premium costs, and effective income tax rates are also just as accurate, and ERI research staff audit these sources with special area research projects. Again, what distinguishes ERI from other cost-of-living sources is that we attempt to provide an affordable in-house resource rather than an expensive consulting service.

  • "How soon can I be using your software?"

    You can be using the software in just a few minutes. A credit card purchase from our website immediately permits download of the dataset. If you prefer to load from a DVD and pay from an invoice or by check, please call our Subscriber Services at 800.627.3697 (US/Canada) or 0800-894-800 (Europe) and you will receive your product(s) by mail, or by express delivery for an additional charge.

  • "How many people can use a subscription?"

    Each annual software subscription is for a single user designated by the purchasing enterprise. The identity of each authorized licensed user must be registered with ERI. Multiple-user licenses are available for an additional licensing fee.

  • "How does your data compare with other firms that provide cost-of-living or wage and salary data?"

    ERI's research analysts know of no other single source that offers both wage/salary information and cost-of-living information.

    For cost-of-living data, due to the continued use of data collection techniques of the 1940s, our competitors have to charge more for one report than ERI charges for an annual subscription to the Relocation Assessor® software and databases. ERI collects cost-of-living data more efficiently and inexpensively, and passes those savings on to subscribers.

    For salary and wage data, you could purchase individual survey sources and conduct an in-house analysis of those sources, or you could purchase compiled wage data from a third-party supplier via a hardcopy report or Internet download. However, ERI offers advantages over both these options.

    Purchasing one of our competitors' surveys is almost always more expensive; one survey can cost as much as an annual subscription to an Assessor Series application that allows for an unlimited number of analyses. Our competitors' individual surveys profile only a fraction of the data available for any given position or area, and they report neither the large number of job titles included in ERI's databases, nor adjustments for the number of industries and areas available to Assessor Series subscribers.

    Purchasing compiled wage data from a third-party supplier also has its drawbacks. Quite often these third-party suppliers require an annual or multi-year contract. ERI's Assessor Series offers the advantages of more wage data and more features at a fraction of the cost.

    What distinguishes ERI from its competitors is not only the lower cost of our products, but also the approach ERI takes to produce and present our data. Like ERI, other companies may utilize market pricing and statistical analysis; but the reliability of ERI's data has been established through peer review and further confirmed by its acceptance in legal proceedings. Few other competitors can make this claim. If you wish to check the reliability of a third-party supplier of wage data, ask whether their data can be used in a court of law or legal documents (thus meeting Daubert challenge standards). If courts won't trust it, why should your management?

    As a research firm (engaged in research, not marketing/sales), ERI has been collecting and analyzing data from thousands of salary surveys for almost 20 years. Most of the third-party suppliers on the Internet have only been in business for a few years. ERI's new executive compensation survey is the largest compensation survey in history.

    ERI senior research staff members include individuals with doctorate degrees who have served in compensation management positions for major US corporations, been professors at major universities, and been published extensively in peer-reviewed professional journals on the subject of compensation.

    ERI's approach to evaluating survey data for validity, as well as the analyses we use to compile data, also differ from our competitors. ERI utilizes a completely different set of position titles, position descriptions, geographic areas, industries, and even types of company/organization size when compared to other companies. The detailed way in which we report data varies greatly from our competitors.

    ERI's Assessor Series offers many advantages when compared to third-party compilers of wage data.

    ERI provides:

    • information on survey sources, standard error, and survey population
    • job code information for each position, as well as job code/industry crosswalks
    • information for more than 5,000 position titles in more than 7,000 geographic areas, including the United States., Canada, the United Kingdom, and some members of the European Union
    • survey description briefs (one-paragraph summaries) and detailed position descriptions based on the format of the original Dictionary of Occupational Titles (DOT)
    • interactive software that permits the selection of specific peer comparables for competitive analysis

    Furthermore, ERI recognizes the greater complexities involved in determining executive compensation vs. non-executive compensation, and provides the added benefit of quickly downloading full proxies and 10-Ks for comparable companies (for greater defensibility and illustration of identifiable practices).

    As of April 2005, ERI has found that the complex coding, job matching, and user interface required for the Assessor Series applications far exceed the capabilities currently allowed by the Web. Our analyses involve hundreds of thousands of lines of code, and have been found to be far more powerful and accurate than what is provided by other companies.

  • "What is the difference between cost-of-living and geographic wage differentials?"

    Wage and salary differentials reflect the local demand for and supply of labor.

    Cost of living is dictated by the local demand for and supply of goods and services. Local wages and salaries do not indicate the local cost of living. Cost of living indicates the comparable local buying power for any given salary.

    The cost-of-living data that goes into ERI databases are downloaded from existing sources. This data includes: rental rates, income taxes, property taxes, gasoline prices, medical costs/services, major retail grocery and drug store prices, etc. Cost-of-living differentials, as reported by ERI, reflect cost models at different income levels (e.g., an auto of "x" value driven "y" miles/kilometers, home rental with no mortgage income tax deductions, home ownership with income tax mortgage deductions in North America, etc.).

    Most compensation professionals agree that when a company is hiring from the local work force (that is, when no transfer or relocation occurs), wages and salaries should be set according to market pricing of wages and salaries only. In general, branch pay should be dictated by market pricing of wage/salary differentials only.

    While employees may find it more desirable for their pay to be adjusted for local cost-of-living variances, this is an unusual practice. In many cases, this practice is not cost effective for the employer. That is, in many cases the employer would be competing against organizations with relatively lower compensation costs, and thus, be at a competitive disadvantage.

    In most cases, cost of living is considered only when an employee incurs new expenses due to an "internal" move, from one branch office to another. In this situation, the new salary would be set according to the destination market (local wage and salary level). Then, any cost-of-living allowance would be awarded separately from salary and for a finite period of time.

    It is undesirable to build a cost-of-living adjustment into salary, as the integrity of the current salary administration program will be compromised. For instance, the transfer of personnel into an office where locally hired employees are earning lower salaries than the transferee's "cost-of-living adjusted salary" is an undesirable and avoidable situation. The transfer of personnel into an area where local competitors' employees are earning higher salaries than the transferee's "cost-of-living adjusted salary" is an equally undesirable and avoidable situation. Better solutions would include the award of a one-time (lump sum) moving bonus, or a gradually decreasing three-year cost-of-living allowance that is awarded separately from the new locally adjusted competitive salary. Each organization's unique situation (tax considerations, cash-flow, etc.) will dictate the best method for handling cost-of-living allowances.

    A random telephone survey by ERI's Director found that only 2% of ERI subscribers pay "the same for all jobs nationally, but vary levels by the cost of living." All other surveyed subscribers stated that they ignore cost of living and concentrate on supply and demand/local market pricing to administer geographic pay differentials.

  • "What is the difference between the US government's Dictionary of Occupational Titles (DOT), the new O*NET system, and PAQ's enhanced DOT database?"

    When ERI released the first Salary Assessor software application in 1987, it was thought that the US Department of Labor's Dictionary of Occupational Titles (DOT) descriptions could greatly assist in creating the format for position descriptions. But when ERI applied its position incorporation policy (that positions common enough to be found in three or more salary surveys be added to the ERI database), we found thousands of positions not covered in the DOT. In fact, over 80% of the Salary Assessor's jobs were not found among the DOT's 12,000+ titles. By the time ERI had concluded that the DOT was too outdated to be relied upon, we had already adopted the DOT's construct. For the past 15 years, ERI has been updating outmoded DOT descriptions and adding new ones, utilizing Internet technology to update all applicable worker characteristic measures.

    Today, the DOT has been discontinued by the US government and replaced by a job-family approach, the O*NET. The DOT's analysis measures have been replaced by over 600 O*NET questions, but few of these relate to "career interest," which goes to the core of rehabilitation and career changing analyses. In combination, all these O*NET questions can't seem to answer the question of whether or not a person is disabled. Career changers, or the professionals who assist them, are not well served by O*NET. But ERI, in connection with PAQ Services, Inc., has been directly updating the original DOT. PAQ Services provides hundreds of organizations with job analysis services. Combining PAQ Services' job analysis capabilities and DOT/eDOT creates synergies in understanding jobs and effectively matching people's qualifications with jobs. PAQ's enhanced Dictionary of Occupational Titles (eDOT) database provides up-to-date job titles and descriptions and filters them based on keywords, industry, DOT attributes, "cross walked" job codes, physical/mental abilities, and job requirements. These are used in the Occupational Assessor® software whose subscribers include vocational experts, attorneys, disability insurers, and state Workers' Compensation agencies. PAQ's raw data collection website can be viewed at www.paq.com.

  • "Which companies use ERI data?"

    ERI does not release listings of the names of our subscribers. Please contact Subscriber Services at for a phone list of ERI subscribers who have indicated that they are willing to discuss their use of ERI products with potential subscribers.

  • "Does ERI provide salaries for interns?"

    ERI only reports rates from surveys. Internships, being typically temporary or seasonal work, tend not to be covered by surveys of competitive pay because their rates are set internally, usually at levels just below the lowest level for the full-time equivalent jobs they fit.

    ERI recommends you pay interns around the 10th or 15th percentiles for first-year incumbents of the positions they fill. This assures these trainees do not make more than current full-time incumbents of comparable jobs.

    Another option is to compare notes with other local employers in your industry, because intern rates tend to be extremely localized and customized to specific industries. Trading with rivals will assure that interns are paid comparably across organizations.

  • "Why do you sell your data on an annual subscription basis?"

    Assessor Series products are licensed as annual subscriptions. That is, ERI leases to its software purchasers quarterly access to Assessor Series software databases. Each quarterly update may be accessed for the quarter for which it is released only. ERI releases updates throughout each year; research is conducted and processed on an ongoing basis. Hard copies of printed tables may be archived by the user, but past quarterly update DVDs are neither stocked nor "re-released" by ERI. Internet files are written over quarterly. Indeed, ERI's research databases are constantly updated and we do not keep archival backups; however, historical data can be found in ERI Salary Surveys, SalariesReview, and Abbott, Langer Association Surveys reports. For further explanation please refer to the ERI End-User License Agreement.

    Annual subscriptions permit ERI to continue in the comprehensive research of pay, cost of living and job content for users in virtually every industry worldwide. ERI is first and foremost a research organization involved in data research, analyses and design for practical end-user applications. The most cost-effective way to assure constantly current data research is through subscriptions covering one or more years.

  • "What background regarding ERI can I share with management when discussing my organization's use of ERI data?"

    ERI Economic Research Institute serves over 7,000 corporate subscribers and thousands of consultants, nonprofit organizations, and governmental agencies in a role that was once filled (internally) by corporate statisticians, operations researchers, wage economists, industrial engineers, compensation analysts, and similar middle-level management support positions that have largely disappeared from Human Resource Departments. At its simplest, ERI collects data from thousands of available salary and cost-of-living surveys, and prepares reports and software analyses by which managers may make decisions. ERI is an outsource of compensation research.

    See About ERI for more information.

  • "I'm having trouble using an ERI software application. How can I contact Subscriber Services?"

    For inquiries regarding ERI products, please use one of the following support options:

    INTERNET: Visit ERI's Technical Support webpages.

    PHONE: (800) 627-3697 or (425) 556-0205 from North America
    0800-894-800 from Europe

    FAX: (360) 733-5550

    E-MAIL:
    You may also use the e-mail feature of any of the Assessor Series applications. (At the top of the Assessor's main window, select File | Send an E-mail.)

    MAIL: ERI Economic Research Institute
    8575 164th Avenue NE, Suite 100
    Redmond, WA 98052 USA

    HOURS OF OPERATION:
    Subscriber Services: 8:00 a.m. - 8:00 p.m. (Eastern Standard Time), Monday through Friday, excluding major holidays

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ERI Economic Research Institute is an Authorized User of selected Statistics Canada data under Agreement Number 6184. ERI's intellectual property rights include Patent Nos. 6,862,596 and 7,647,322, "System and method for retrieving and displaying data, such as economic data relating to salaries, cost of living and employee benefits." Other Internet-related applications are Patents Pending.