Total salaries of executive managers vary quite a lot. They range from less than 30.000 Euro to more than half a million Euro per year. Almost fifty percent of executive managers are paid between 50.000 and 100.000 Euro. 37 percent earn between 100.000 and 150.000 Euro and 12 percent are remunerated with more than 150.000 Euro for their work. These are the findings of the latest “executive managers 2006” salary study by the Kienbaum management consulting firm.
The bigger the company – in terms of turnover and number of employees – the higher the salaries of managing directors. With on average 171.000 Euro top-level executive managers in a major company (more than 5.000 staff) earn almost twice as much as their counterparts (91.000 Euro) in smaller companies (up to 50 employees). Also important is the profit situation of a company: more profitable ones pay their executives more than those earning less money. Earning differences in turn heavily depend on company size. Thus, in a small company with a turnover of up to approx. 20 million Euro a top-level executive manager earns 92.000 Euro in times of below-average profitability, whereas he or she will be able to increase this salary to up to 98.000 Euro in times where profits are above average. Managers in major companies (approx. 1 billion Euro turnover) working in a similar position will earn 163.000 Euro in good and only 138.000 Euro in bad times.
Men are paid more: The percentage of female executive managers has only slightly changed in recent years and currently stands at nine percent. Ten years ago, in 1996, this number was five percent. Given that about half of the working population are women, they are very unproportionately represented in top-level management.
By pursuing a certain salary policy companies seek to obtain quite a broad range of objectives. For 86 percent of those questioned salaries are a means of strengthening the performance and success orientation of managers, whereas for 60 percent salaries are a means of motivation. For 66 percent of companies surveyed salaries are instrumental in committing so-called key personnel on a long-term basis to the company and only 16 percent said that salary policies are used in order to increase the “cost efficiency” of a company.
In Germany executive managers are among those occupational groups which are best educated. 72 percent of top-level and 55 percent of second-level managers are graduates from universities or universities of applied sciences. In general, the higher the position of a manager in a company´s hierarchy, the better is his or her education. There is another marked correlation between company size and level of education: the bigger a company, the higher the percentage of university graduates working there. Among these graduates for years economists and social scientist on the one hand and engineers on the other have been most strongly represented with 36 and 29 percent respectively. 