The Average Salary of a Payroll Manager

A payroll manager is responsible for the payroll functions in an organization, including payroll preparation, payroll systems maintenance, tax reporting and records administration. This position requires five to seven years payroll experience and a bachelor's degree in business, accounting or a related field.

National Average

• According to Salary.com, the national average salary for a payroll manager across the U.S. as of October 2010 is $75,416. The salary ranges from $54,637 to $96,785. The total average compensation package goes up to $110,250 if the cost of benefits is calculated. Benefits typically include bonuses, Social Security, 401(k), disability, health care, pension and time off. PayScale, a provider of market pricing and compensation solutions, pegs the national average a bit lower, with salary ranging from $42,591 to 67,205.

Geographical Location

• PayScale's salary data indicates New York as the state in which the highest salary range is paid to payroll managers. The range is from $49,977 to $74,856. California and New Jersey are the two other highest-paying states. Among the cities, Columbus, Ohio pays best, with a salary range of $48,884 to $78,617. New York City and Chicago follow closely behind. These are highly urbanized centers where competition for talent is tighter, hence the need to pay more.

Qualifications

• The average salary for a payroll manager increases based on years of payroll experience. For managers with less than one year experience, the salary ranges from $34,999 to $50,000. For 20 years or more experience, payroll managers can get between $50,914 and $74,782. PayScale's data also shows that those with a certified payroll professional or certified public accountant designation generally receive higher salaries. Managers who possess skills in project management, the ADP payroll system and payroll tax compliance also get paid more.

Company

• Companies with an employee size between 5,000 and 19,999 pay the highest salary to payroll managers. The salary ranges from $58,522 to $82,828. The higher salary compensates for the bigger scope of responsibilities and complexity of payroll in these organizations. State and local governments also pay higher salary, with a range from $49,379 to $76,420. They are followed by private firms and hospitals. The financial services, manufacturing and distribution, and health-care industries pay the highest salaries to payroll managers, according to PayScale.

Considerations

• Payroll managers who want to earn more must strive to get a payroll certification and acquire more experience. They can also look for jobs in large organizations in urban centers. Payroll managers can progress to higher positions such as payroll and benefits manager or senior payroll manager. Bigger companies may have a director or vice president of payroll. The salary for these positions could go up to $98,913.