Project management has grown to be one of the most lucrative job sectors, with companies starting to grasp the importance of project management. A report published by the Project Management Institute (PMI) predicted that the project-management field is forecasted to grow by 33% through 2027 - a jaw-dropping 22 million jobs.
With the rise of the work-from-home trend likely to continue even after the COVID-19 pandemic, project management roles are more important than ever. Glassdoor also lists project managers as the 3rd Best Job in the US in 2021 based on salary, job satisfaction & potential job growth.
Apart from appealing statistics, there are a lot of other reasons to get into project management. Project managers generally earn a good living, have job security, work reasonable hours and enjoy a range of fringe benefits.
But how much do project managers actually make?
The answer to this, however, is not that simple. A lot of factors work into defining how much earning potential a project manager has.
Companies have varying job titles and responsibilities assigned to project managers, not to mention the unique criteria for recruitment and promotions. Financial strength and business goals also dictate the potential pay scale for project managers.
In this article, we’ll get into details on the latest data on project manager roles, salary ranges, and factors impacting the salaries of project managers.
Why Are Companies Looking For Project Managers?
One question that pops up every now and then is, “Do we actually need a project manager?”
This can be a daunting question, as having specialized project management teams can look quite expensive.
However, running a project without effective project management processes can be a recipe for disaster. Good project management means more than just delivering on time, budget, and scope - it means uniting clients & teams, getting everyone on the same page, creating a vision for success, and helping everyone navigate unforeseen catastrophes. Here are three primary reasons businesses employ project managers:
- Leadership
- Strategic Alignment
- Risk Management
Leadership
Project management helps give teams direction. It enables team members to perform at their utmost capacity. Project managers provide motivation, remove roadblocks, coach, and inspire the team to do their best work.
Project managers also provide a system of hierarchy that enables them to ensure clear lines of accountability. This helps avoid any confusion when it comes to assigning tasks and roles to team members.
Moreover, project managers keep everyone in their teams in line because at the end of the day, whether the project fails or succeeds is a responsibility they shoulder.
Strategic Alignment
One of the responsibilities that a project manager has is to make sure that they execute the projects they are assigned properly so that they fit well within the context of a client or company’s broader framework(s).
In other words, project management ensures that the goals of the project align with the goals of the business itself. And as projects progress, risks tend to emerge. The project manager is responsible to identify those risks and lead realignment efforts.
Risk Management
Project managers analyze possible risks, try to mitigate these risks before they manifest, and create contingency plans if any of them become real issues. This requires project managers to have the skill to ask the right questions, to discover risks early, and the ability to mitigate said risks.
If you want a more in-depth view of the significance of project management, check out Markup Hero’s Guide To Project Management Essentials.
Key Factors that Determine a Project Manager’s Salary
The difference between the salaries posted on job portals such as Glassdoor or PayScale showcases a massive difference between the salaries of project managers. The salaries range from $56k to $200k.
This inconsistency can be attributed to a lot of factors, both internal and external. Each factor has enough agency to cause severe fluctuations by itself.
There are mainly 5 factors that determine a project manager’s Salary:
- Rank
- Location
- Industry
- Company Strength
- Certifications
Rank as a Factor For Project Management Salary
Each company assigns project managers with different roles based on their needs. These roles and their importance dictate how much each project manager makes.
A project manager team may be built on a hierarchy with different levels of pay. There are entry-level project manager positions that require little to no experience, and there are also executive level positions that require a certain degree of expertise.
Associate Project Manager - Entry Level
An Associate Product Manager (APM) is tasked with helping senior project managers run large projects that require multiple supervisors. They oversee the cost & budget of the project and ensure that the team finishes on time.
Other responsibilities include reporting to upper management, delegating tasks, and making sure everyone stays on schedule. However, an associate manager lacks company-wide decision-making authority.
- Years of Experience: 0-2 years
- Educational Requirement: Bachelor’s Degree in Business or related fields, and/or a Master’s Degree
Experts state that you may enter the field with only a high school degree, given that you have prior experience working as an intern in project manager.
Average Annual Salary:
- $68,203 (Glassdoor)
- $58,854 (PayScale)
Range:
- $43,000 - $80,000
Yearly Cash Bonus:
- $3000- $5000
If you’re new to this field, check out Markup Hero’s article on 10 Key Project Management Principles for Beginners in 2021.
Senior Project Manager - Executive Level
A senior project manager or project director is tasked with overseeing the implementation of a project from start to finish through budgeting, sourcing supplies, and & planning the project release.
It is a thorough leadership role that requires the person to hold important meetings, communicate with important stakeholders, and make important decisions that affect the company.
Senior product managers may also perform HR roles, such as recruiting employees and managing them. They also set deadlines for other employees.
- Years of Experience: 5-8 years
- Educational Requirements: Candidates must have formal education in Business fields such as Marketing, Management, and Finance. 47% of Senior project managers have a Master’s degree, and 38% have a Bachelor’s Degree.
Senior project managers are usually promoted from project manager, product manager, or marketing manager positions. However, it is not uncommon for people to shift to this role from other fields, given that they possess the skills and knowledge required to do so.
Average Base Salary:
- $118,176 (Glassdoor)
- $104,496 (PayScale)
Range:
- $74,000 - $142,000
Yearly Cash Bonus:
- $1,000- $22,000
Are you a grizzled veteran in the project manager field and are looking for a new tool to help you manage your projects? Check out Markup Hero’s review of Paymo, the One Tool to Rule Them All!
IT Project Manager - Entry Level
IT project managers coordinate with other IT professionals and administrative staff to produce new software. They organize, plan and integrate significant cross-functional information technology.
The core responsibilities of IT Managers are the same as other project manager positions - to organize people, manage time and resources, and oversee the development of a project from inception to completion.
- Years of Experience: 0-2 years
- Educational Requirements: Most IT project managers have an educational background in Programming or Engineering.
Average Base Salary:
- $102,766 (Glassdoor)
- $88,820 (PayScale)
Range:
- $57,000 - $128,000
Yearly Cash Bonus:
- $1000 - $17000
Location as a Factor For Project Management Salary
Location is one of the most important determinants of a project manager’s Salary. The living costs and job demand of the country you are residing in will determine how much money you are making as a project manager.
Higher living expenses contribute to higher wages. If the region you are residing in has a high demand for project managers, companies will offer higher salaries with more benefits.
Project Managers Inside the US
On average, project managers in the US are paid the most. The average salary of a project manager in the US is approximately $116,000. However, standard deviations of pay exist within each state within the US.
The pay scale in certain states is much higher than in the rest of the country. For example, the average salary of a project manager in San Francisco is $91,000, whereas the average in Chicago is $76,000. Managers in the East and West Coast also earn more on average.
The following chart shows how much project managers make in different cities inside the US.
Project Managers Outside the US
Switzerland is the only country that surpasses the US when it comes to the average salary of a project manager, where managers make a whopping $132,000 a year.
Nordic countries come close to the US in salary ranges. While European nations often have a high average salary range for product managers, this pay scale varies a lot within each European country.
On the other hand, the average pay of a project manager is often high and stable in the Australian continent.
Here is a look at how much project managers across the globe make.
The Industry As a Factor For Project Management Salary
Fast-growing industries that heavily rely on technology often pay project managers the most on average. The competitive nature in each industry plays an important role too.
However, salary variations amongst companies in the same industry can be noticed as well. Each industry often has different requirements of skill and education from project managers.
For example, an IT company and a construction company will employ project managers with different educational backgrounds. This is another factor that affects the pay scale of project managers in different industries.
The following graph shows how much money project managers from different industries make annually.
Company Strength as a Factor For Project Management Salary
The math here is pretty straightforward. The bigger the company is, the more they will pay their employees. For instance, tech giant Google pays its project managers $158,125 on average, while Amazon pays its project managers $95,000.
You are likely to be paid more working for a leading company because these businesses often only recruit the best of the best and have enough capital to incentivize you to work harder to further their own growth in the future.
The chart below shows the difference in pay scale between project managers employed by different companies (based in the US).
Certifications as a Factor For Project Management Salary
Project management certifications are relatively new to the business world. They were born out of the growing demand and importance of product managers as a form of quality control.
Entry-level project managerial positions only require you to possess a high school diploma, and you may work your way up to more lucrative positions over time. Mid-level managers & executives may pursue these certifications to be updated on current industry standards and gain an edge over their competitors.
You may also take project management courses to strengthen your resume. certifications often work as confidence boosters and will likely help you acquire a robust skillset that translates to better performance.
A survey by the Product Management Institute states that respondents with PMP certification report 22% higher median salaries than those without.
However, you DO NOT need certifications to begin your career as a product manager. But certifications will definitely boost your chances to climb up the project management ladder or be offered more lucrative jobs.
Certifications help you stand out from your competition - something that can never go wrong.
If you don’t know where to start, try something simple like reading Markup Hero’s Guide on How To Become A Project Management Ninja.
Conclusion
Hopefully, this article has given you a picture of the salary ranges of project managers, why they are important in the current landscape, and helped you understand the qualifications necessary to become one.
Project managers are becoming more relevant as days go by. This field is lucrative, but it will require you to become the best version of yourself. You can start by strengthening your resume, taking project management courses, and diving into the basics of whichever industry you would like to pursue your project management career in.
In short, if you are thinking of pursuing a future in this field, get ready to compete.
Best of luck!
