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Introducing Budget-Only Reports

ChurchSalary is excited to offer this new and incredibly powerful way to analyze compensation.
Introducing Budget-Only Reports

ChurchSalary is excited to announce two major updates to our Salary Calculator!

  1. Budget-only Reports
  2. Salary Localization (for full-time pastors)

Budget-only reports are a new and incredibly powerful way to analyze compensation. We encourage members to leverage this new feature, as this new methodology can significantly improve the precision of compensation reports for churches on the margins—outside of common budget/size categories.

Why is ChurchSalary is moving to budget-only reports and how your church can best utilize them when analyzing compensation at your church?

Budget & Size = Shape
A 3D simulation of the frequency of church shapes (budget and size) in ChurchSalary's database.

A 3D simulation of the frequency of church shapes (budget and size) in ChurchSalary's database.

Like the human body, there are only so many shapes a church can take before its proportions start to look … odd. Like the ratio of height to width in humans, the ratio of people to resources (or size to budget) in a church trends toward an equilibrium.

This equilibrium creates a valley (or main current) of church growth. Extremely thin (e.g., 1,000 people/$50,000 budget) and extremely thick churches (e.g., 50 people/$5 million budget) are virtually impossible. Less extreme budget & size combinations are possible, albeit rare. Since climbing outside of this valley (or swimming outside the mainstream) is hard, these congregations are statistical outliers.

Overcoming real-world limitations

Based on a recent analysis of 14,000+ churches in our database, ChurchSalary knows how rare these outliers are. As you can see in the chart below (and 3D simulation above), it is rare for budget and size to exceed a difference of 3 or 4 categories (e.g., size 5/budget 1 or size 10/budget 5).

In the past, in order to account for this real-world problem, ChurchSalary generated size-only reports. Dropping budget as a criterion enabled churches on the margins to access a larger data set.

Indeed, the scope of this real-world distribution problem, coupled with our high internal standards for statistically validity, means that a budget & size report is virtually impossible to create for over half of the 100 possible budget/size categories. Indeed, in a fascinating instance of the Pareto Principle, 80% of employees in our database fall into 20% of the budget/size categories (and 91% fall into 30% of the categories).

The budget percentages in each vertical (size) column add up to 100%.

The budget percentages in each vertical (size) column add up to 100%.

Budget Only

With the help of Clarity Research, ChurchSalary was able to analyze the relationship of salaries to budget and size in the first quarter of 2021. This analysis revealed a much higher level of positive correlation between budget than size.

For all these reasons, budget-only reports are the safest and best way to analyze compensation for less common churches.

Consider a hypothetical congregation called First Duluth Community Church with a budget of $1.1 million and 290 people (201–300/$1M–$2M). Less than 1% of congregations in ChurchSalary’s database share this budget/size combo. Instead, the vast majority (71%) of churches in the 201–300 size range have a budget that is 2 to 4 times smaller. As a result, a size-only report for First Duluth would reflect lower salaries from churches with smaller budgets. By contrast, a budget-only report will pull from a more representative (and larger) set of employee salaries spanning across six size ranges.

How to leverage budget-only reports

There are several reasons why budget-only reports may help your church. For churches outside the mainstream, our Salary Calculator will automatically discard size as a criterion. However, churches of all sizes can leverage budget-only reports.

First, by their very nature, budget-only reports draw on a data set that is 2 to 4 times larger than budget & size reports. This larger data set can be leveraged to produce more averages (fewer dashes) in either the Salary Comparison or Localized Salary Recommendation sections.

Second, if your church falls into a wide budget category ($1M–$2M, $2M–3M, $3M–$5M, $5M+) consider producing two sets of contrasting reports: budget-only and budget & size. The difference between these reports, as well as the distribution graphs in the Nationwide Salary Summary sections, can help you determine where your church fits within this large budget category. For example, the finances of 1,000–2,000 person church with a budget of $3 to $5 million may have more in common with the average 2,000–3,000 person church. Being able to compare and contrast reports in this way can help clarify where your church fits in the valley (or current) of church growth—and where your salaries should fit as well.

Join now to begin generating budget-only reports!

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Lilly Endowment

ChurchSalary is made possible through funding from the Lilly Endowment Inc. As part of Lilly's "National Initiative to Address Economic Challenges Facing Pastoral Leaders," ChurchSalary—and our parent, Church Law & Tax—is committed to helping church leaders and pastors develop an atmosphere of healthy financial stewardship, especially in the area of church staff compensation.