What Is Mean Salary: Definition, Formula and Importance

By Indeed Editorial Team

Updated 15 May 2022

Published 4 October 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Finding reliable information about salary is often one of the most important parts of any job search process for many candidates. One way to compare salaries of different professions is to consider central values like mean salaries or median salaries. With this information, you can decide which job prospects are best for you. In this article, we define what is a mean salary value and how to calculate it, plus explain how it differs from the median salary value and list the top 10 jobs and their average salaries.

What is mean salary?

The mean, or average, salary is the amount derived by adding two or more salary values and dividing the sum by the number of values. Like the arithmetic mean, this figure is easy to understand, easy to calculate and is least affected by sampling variation. Average salary figures based on a large salary dataset, with proportionate representation of extreme highs and lows, usually tend to be more reliable and accurate.

What is the importance of mean salary?

The mean salary figure is extremely important in job searching, job listings and other HR-related processes. This central tendency of industry salary value holds significance for both job applicants and recruiters. When looking for new job opportunities and making career-related decisions, the mean salary helps job seekers understand which professions, industries and cities offer higher average salaries. For example, the average salary of software engineers in Mumbai, Maharashtra is ₹56,850 per month. This is notably higher than ₹37,721 per month, which is the annual average salary of software engineers in Pune, Maharashtra.

Similarly, it is important for recruiters and hiring managers to be familiar with the average salary in the job market to offer competitive wages and create relevant job descriptions.

Related: How To List Job Responsibilities in Job Listings

How do I calculate the mean salary?

The basic formula for calculating the mean salary is (a+b+c…..n)/n. So, to calculate the mean salary of five different salaries, the formula will add the values of the five salaries and divide the sum by five.

For example, five employees are working in the same role across different companies and their salaries are as follows:

  • ₹3,00,000

  • ₹3,28,685

  • ₹3,72,500

  • ₹4,18,972

  • ₹4,22,066

To determine the mean salary of the above dataset, add the individual salary values to get to a sum of ₹18,42,223. Then, divide the sum by five, which is the number of salary values, to get the mean salary of ₹3,68,444.6. In this manner, by dividing a large dataset of industry-wide salary figures into subsets, you calculate the mean salary across different locations and organisations.

Related: How To Find Average: A Step-by-Step Guide With Examples

How is mean salary different from median salary?

Mean and median salaries are both representatives of the central tendency of a set of salary figures, but they use different approaches to calculate this value. While mean salary is the simple average of the different salary figures, median salary represents the middle value in a set of salaries. Half the salaries in the dataset are more, and the other half are less than the median salary value.

Despite their similar purpose, the values of mean and median salary can vary significantly even for the same set of data points. This is because of the different methods used to calculate the mean and median salary. Furthermore, mean salary values can have a decimal, whereas median salary values are whole numbers unless the data contains salary figures with decimals.

What is the importance of median salary?

Like mean salary, the median salary value helps with job search and career research. The median salary value indicates how much people are earning in a particular role or industry. It can help in short-listing job opportunities and negotiating during interviews. For recruiters, employers and HR, the median salary helps decide the remuneration for roles as per prevailing industry standards.

Related: Salary Negotiation Tips and Examples

How do I calculate the median salary?

Calculating the median salary is a simple process. The first step is to list all the salaries to be considered in an increasing order, i.e., starting from the lowest to the highest. If the number of salaries (n) is odd, then the median would be the salary figure in the middle of the list. If the number of salaries (n) is even, then add the middle two salary figures and divide the sum by two to determine the median salary.

Consider the same set of salaries as used above to understand how to find the median salary. In the example, the salary amount of ₹3,72,500 is exactly in the middle, as two salary amounts are lower than it and the other two are higher. Thus, the median salary for this salary dataset is ₹3,72,500.

Mean salary vs. median salary

In the example illustrated, there is not a significant difference between the mean and median salary figures. However, if you add more values to the dataset, you may get different results. For example, consider adding a sixth salary value of ₹7,44,283 to the dataset. Thus, now you have the following salaries:

  • ₹3,00,000

  • ₹3,28,685

  • ₹3,72,500

  • ₹4,18,972

  • ₹4,22,066

  • ₹7,44,280

To find the mean, calculate the sum total of ₹25,86,503 and divide it by six to get ₹4,31,083.83. To find the median, add the middle two figures to total ₹7,91,472 and divide it by two to get ₹3,95,736.

Since mean salary data is vulnerable to distortion if an abnormally high or low salary figure is present in the dataset, many employers prefer to use the median salary value as the industry benchmark. For salary datasets that have outliers or a concentration of diverse figures, the mean salary value may not provide a realistic view of the typical salary in a particular industry or role. Using the median salary value eliminates this, as it is not sensitive to very high or low salary figures and points towards the common salary figure in a more neutral way.

Average salary for top 10 jobs and locations

Understanding which jobs and industries pay higher average salaries can help you in choosing the right career. Here are the mean salaries for the top 10 jobs roles and information about which cities pay the highest average wages:

1. Interpreter

National average salary: ₹6,58,049 per year

Highest paying city for interpreters: Bengaluru, Karnataka

Primary Responsibilities: Interpreters facilitate communication between parties who do not speak the same language. They translate both written and verbal messages during meetings, conferences and events. Interprets are also an essential part of diplomatic and embassy services.

2. Safety manager

National average salary: ₹7,75,630 per year

Highest paying city for safety managers: Aurangabad, Maharashtra

Primary Responsibilities: Safety managers ensure that the company and employees comply with safety and health laws. They help in creating a safe workplace by identifying and fix safety threats. Safety managers play a crucial role at construction and manufacturing project sites.

3. Quality manager

National average salary: ₹50,518 per month

Highest paying city for safety managers: Bengaluru, Karnataka

Primary Responsibilities: Quality managers supervise manufacturing processes to maintain product quality. They assist in improving products and work with different teams to solve quality-related challenges. They are also involved in creating new products.

4. Assistant superintendent

National average salary: ₹45,821 per month

Highest paying city for safety managers: Kolkata, West Bengal

Primary Responsibilities: Assistant superintendents support project execution and delivery while ensuring timeliness. They help follow budgetary and compliance guidelines. They may also conduct inspections in workplaces and at project sites.

5. Brand manager

National average salary: ₹44,561 per month

Highest paying city for safety managers: Gurgaon, Haryana

Primary Responsibilities: Brand managers design and execute a brand strategy for businesses and clients. They also maintain brand consistency across all communication processes. They assist functions like marketing and sales.

6. Business development manager

National average salary: ₹36,475 per month

Highest paying city for safety managers: Gurgaon, Haryana

Primary Responsibilities: Business development managers plan business growth by identifying new sources of revenue and markets. They research prospects and target users to engage prospects and leads. They also help formulate strategies for sales and marketing.

7. Frontend developer

National average salary: ₹6,08,163 per year

Highest paying city for safety managers: Gurgaon, Haryana

Primary Responsibilities: Frontend developers create a smooth and intuitive user experience and develop engaging user interfaces. Using development languages and tools, they operationalise designs. Essentially, they manage all aspects of user interaction and data flow.

8. Full-stack developer

National average salary: ₹7,38,105 per year

Highest paying city for safety managers: Bengaluru, Karnataka

Primary Responsibilities: Full-stack developers design and create software solutions. They write error-free codes for the front- and back-end operations. They also assist in quality assurance, testing and database management.

9. Business analyst

National average salary: ₹42,401 per month

Highest paying city for safety managers: Bengaluru, Karnataka

Primary Responsibilities: Business analysts research business problems and identify growth opportunities. They create plans, budgets, analysis reports and forecasts. Data collection and analysis is an essential part of their role.

10. Software test engineer

National average salary: ₹34,840 per month

Highest paying city for safety managers: Bengaluru, Karnataka

Primary Responsibilities: Software test engineers detect errors in code, develop test cases and report defects. They undertake regression tests every time the code is changed and run diagnostic tests. They also help automate test designs.

Salary figures reflect data listed on Indeed Salaries at time of writing. Salaries may vary depending on the hiring organisation and a candidate's experience, academic background and location.

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