A great deal of salary statistics are averages (e.g., the average senior pastor salary in the United States). To produce these averages, organizations typically lump all senior pastors into one giant dataset and divide by N (sample size). These broad averages are useless for salary reviews or negotiations. Additionally, it impossible to analyze, using these broad averages, the impact of individual variables on salary.
Confounding Variables
Many factors or variables can impact the salary of a church employee. The most common are church budget, church size, location, geographic setting, experience, education, track record of success, and skills.
Because each variable plays a small part in the overall compensation formula, they are mixed and cooked together like ingredients in a soup. It is impossible to tell whether one “adds anything” without isolating the other confounding variables. ChurchSalary un-mixes compensation data and analyzes its nuances using two methods:
- Sorting data into bins or categories
- Normalizing data
Sorting or Grouping Data
The two primary variables that influence compensation for pastors and church employees are (1) role and (2) ministry scope (typically reflected in a church’s budget). Stated another way, the range and scale of a pastor’s salary is informed by two primary questions:
- How much of the ministry is the pastor responsible for?
- How big is the ministry as a whole?
These two primary variables are why senior pastors get paid more than youth pastors and it is why senior pastors at suburban megachurches get paid more than senior pastors at small rural churches.
Because budget is the variable most positively correlated pastor’s salary, followed closely by size, ChurchSalary uses ten different budget and size categories or “bins” to pre-process data. These groups or segments enable us to group employees into relevant datasets which compare the salaries of similar employees serving at similar churches. Without these groups, the distribution chart and salary range for all senior pastors would be too broad and heavily right-skewed (fig. 1). Figures and graphs like these are as useful for evaluating and setting compensation as statistics that include members of your church softball team and the Chicago Cubs.
ChurchSalary pre-processes compensation data into at least three bins (*four, if you include church size as a criteria):
- Position (18 roles)
- Employment Status (2 options: full-time or part-time)
- Budget (10 bins)
- Size* (10 bins)
The criteria you select on the Query page tells the Salary Calculator how to pull the most relevant dataset out of ChurchSalary’s 24,000+ employee database.
Using this most relevant dataset, ChurchSalary generates a custom salary report that features a distribution graph and a salary range, as well as a set of averages, a location recommendation, and stats on how salary varies based on common compensation factors (fig. 2).
Normalizing Data
To analyze the correlation of different variables (region, education, gender, denomination, etc.) across for seven major pastoral positions in our 2021 Pastoral Salary Report, ChurchSalary, with the help of Clarity Research, normalized compensation data using budget as a variable.
Normalizing is a way to transform or “feature scale” data. There are numerous ways to accomplish this. All of them involve rescaling data based on a common feature. For example, one method involves adjusting sets of data using minimum and maximum values.
For the 2021 Pastoral Salary Report, Clarity Research calculated the average salary of pastors for each of the ten budget ranges. Each budget range was then adjusted up or down, conforming it to the national average. This helped minimize the impact of budget on our statistical analysis and enabled Clarity Research to analyze the impact of region, education, gender, and denomination on pastoral salaries across all ten budget ranges.
Normalized averages are useful for illuminating the impact (correlation) of specific variables on salary. However, because they have been adjusted or shifted, averages that have been normalized by budget should not be used for direct salary comparisons or as a reference point for salary reviews. To perform direct comparisons and salary reviews, ChurchSalary recommends that you create a custom report based on your church’s specific budget and/or size.
