Major metropolitan areas have a higher cost of living than rural ones. That’s according to data from the U.S. Bureau of Economic Analysis.
This map, published by Business Insider, shows the relative cost of living across the country. California, New York, the DC/Maryland/Virginia area, Hawaii, and Connecticut are among the states with the highest cost of living. They also have large metropolitan areas that drive up the state’s average cost of living.
For credit unions, cost of living directly impacts average employee compensation. Salaries and benefits per full-time employee equivalent (FTE) is typically the largest non-interest expense for the industry. That expense is currently at 51.3%.
It’s no coincidence the Relative Cost of Living map from Business Insider closely aligns with the map below which uses data from Callahan & Associates of average employee salary and benefits per FTE for credit unions in the United States. ContentMiddleAd
As of third quarter 2017, credit unions in California had the highest average employee compensation per FTE $88,300. The DC/Maryland/Virginia metropolitan area comes in at No. 2 with an average of $85,500. Alaska, New York, Washington, and Connecticut follow with averages of $82,300; $81,500; $80,800; and $79,000, respectively.
SALARY & BENEFITS PER FTE BY STATE
FOR U.S. CREDIT UNIONS* | DATA AS OF 09.30.17
CLICK TO ENLARGE
* DATA FOR U.S. CREDIT UNIONS REPORTING THIRD QUARTER 2017 DATA.
Source: Callahan & Associates.
According to the 2017 Employee Job Satisfaction and Engagement report from the Society For Human Resource Management (SHRM), compensation is the No. 2 contributor to job satisfaction, trailing only respectful treatment. In 2010, it was the fifth most important.
Compensation links to employees’ most fundamental safety and security needs by offering financial stability, says the study’s authors.
Watch It On-Demand
Callahan & Associates and Todd Lane, CEO of California Coast Credit Union, discuss how the cooperative calculates its area’s living wage and what that means for its employment strategy. Watch The Living Wage: A New Approach To Employee Pay today.
Sixty-one percent of survey respondents said compensation was very important, yet only 26% reported satisfaction with theirs. Knowing where a credit union stands in relation to its region is the first step toward compiling a fair compensation package for employees. Some credit unions are now offering a living wage to build a productive, engaged workforce.
For credit unions that operate in a less expensive area, calculate how far the organization’s average salary, without benefits, would stretch in other areas of the country using CNN Money’s comparable salary calculator.
Catch Up On 3Q 2017 Trendwatch
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