Generation Y: What is a lot of Money?
[Editor's note: Katie Bardaro, PayScale research analyst and recent U of Washington economics master's degree recipient, is contributing posts to the Dr. Salary blog. Dr. Salary is categorized as generation "X", mostly because of his attitude towards "Baby Boomers".]
People in my generation (Generation Y) expect to earn high pay after college graduation, but is this realistic? According to an article by CNN.com, those in Generation Y want "better pay, a flexible work schedule and company-provided [technology]." In fact, an overwhelming majority of hiring managers and HR professionals describe these people as exhibiting "a sense of entitlement that older generations don't."
What type of salary can those of us in Generation Y expect and what is considered a lot of money? Here at PayScale, we are obsessed with accurate salary data and can use our database of over 16 million profiles to answer this question.
In this blog I will look at some interesting salary facts according to several different characteristics: school, major, gender, job titles, and location.
Are you a recent college graduate and wondering whether you are earning top dollar? Use the PayScale Salary Survey to find out.
School and Major: What Pay for Generation Y?
Please see PayScale's Education Report and an accompanying article by Forbes for a detailed look into salary by school and by degree/major. The pay reported in this report (and this blog) is defined as annual cash earnings, from hourly wages or salary, combined with bonuses, commissions, and other cash earnings. Earnings from equity (stock grants and stock options) are not included.
According to our education report, those who choose to major in engineering, computer science, and economics earn top dollar after about 2-3 years of experience, with a median salary of at least $50,000. In their mid-careers, those with these majors often earn a six-figure median pay.
Unsurprisingly, graduates from top-tier ivy leagues can expect to earn a higher starting salary. Graduates from these schools with 2-3 years of experience typically earn ~$60,000.
Generation Y: Pay of Men vs Women
The starting median pay across all careers and majors in 2008 for a recent graduate in Gen Y was $42,700 for men and $34,300 for women.
This PayScale data set includes bachelor's degree graduates 20 to 27 years old in 2008, who have been working for <2 years in their field.
These figures represent the "typical" pay for the two genders in Generation Y, but what about the extremes? How low is low pay and how high is high pay? The answer is given by the 10th and 90th percentiles. The 10th percentile is a benchmark for low earners--90% of the workers will earn more, while only 10% will earn less. On the other hand, the 90th percentile represents the high earners as only 10% of workers can expect to earn more.
The 10th and 90 percentiles for male college graduates are $30,300 and $59,000 respectively, while the 10th and 90th percentiles for female college graduates are $25,500 and $47,200 respectively. As you can see, women from Generation Y still suffer from a similar fate as women from earlier generations: they often earn less than their male counterparts.
Gen Y Men vs Women and College Majors
Unlike the overall figures given above, the differences between male and female college graduates from Generation Y are not as clear-cut when we look at specific majors. In fact, women who major in engineering have a higher median pay then men in the same major. The following table gives the starting median pay across gender for 10 common majors.
| Major | Male Median Pay | Female Median Pay |
| Electrical Engineering | $57,600 | $58,100 |
| Civil Engineering | $51,000 | $51,700 |
| Computer Science | $50,700 | $45,400 |
| Accounting | $44,700 | $38,900 |
| Economics | $44,400 | $40,700 |
| Political Science | $37,500 | $33,400 |
| Biology | $34,500 | $32,200 |
| Psychology | $33,300 | $31,500 |
| Communications | $32,800 | $34,700 |
| English | $31,900 | $34,500 |
The female top earners (90th percentile) in the above majors can earn between $41,000 (Communications) and $75,600 (Electrical Engineering). The male top earners can earn between $46,200 (Psychology) and $67,500 (Electrical Engineering). Although female pay is typically below male pay, women can see a wider range in pay than men.
Top Salary Jobs for Gen Y
The following table gives the starting median pay and the starting top earner (90th percentile) pay for 10 common jobs:
| Job | Starting Median Pay |
Top Earner Median Pay |
| Information Technology (IT) Consultant | $56,600 | $66,700 |
| Mechanical Engineer | $55,600 | $64,700 |
| Software Engineer / Developer / Programmer | $55,500 | $69,800 |
| Project Engineer, Construction | $54,000 | $62,800 |
| Registered Nurse (RN) | $50,000 | $62,600 |
| Financial Analyst | $46,700 | $60,100 |
| Accountant | $37,800 | $46,800 |
| Inside Sales Representative | $36,200 | $46,700 |
| Elementary School Teacher | $33,600 | $42,200 |
| Marketing Assistant | $31,900 | $38,600 |
Similar to college majors, those in IT and engineering often earn higher median starting salaries than other careers. The starting median salaries of these careers are even higher than the top earners in the fields of Accounting, Sales, Teaching, and Marketing. Consequently, if high pay is your goal, follow the golden path of technology and engineering.
Finally, Location Matters
Earnings are tied to location, partially due to the cost of living in an area. For example, an Accountant in New York City can expect a higher median starting salary ($47,800) than one in Albuquerque, New Mexico ($39,300).
If you are interested in how your salary must change to compensate for a move to a new city, visit PayScale's Cost of Living Calculator.
$50,000/Year is a Lot of Money
With the exception of engineers and those in IT, recent Generation Y graduates simply should not expect pay in excess of $50,000 per year.
This goes against the current expectations for some, but a starting pay greater than $50,000 could be considered a high starting salary, depending upon the job.
These data are for 2008, before the white collar economy really hit the skids. Generation Y graduates will need to push their sense of entitlement and desire for high pay aside, especially during these tough economic times. As the unemployment rate continues to rise, Generation Y-ers will need to cut salary expectations if they hope to procure a job, particularly as the majority of others in the job market are doing so willingly.
What type of pay can you expect with your education? Be prepared with accurate salary expectations in your next job interview or review. For powerful salary data and comparisons customized for your exact position, job offer, and degree, be sure to build a complete profile by taking PayScale's Full Salary Survey.
Regards,
Katie Bardaro
Research Analyst, PayScale, Inc.
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I have been trying for months now to complete the payscale salary survey and it appears that the page is moved...any idea on when this can be fixed so that i can also update my profile???
Posted by: Kim | September 23, 2009 at 09:10 AM