What Factors Affect an Area Manager's Salary?

An area manager is a senior company employee who oversees operations within a particular geographic area. As with most positions, an area manager's salary depends in part on his or her academic and professional credentials. Furthermore, firms operating in many different industries employ people in these roles and the wages of a manager are directly impacted by the sector within which the individual works.

In some instances, area managers are individuals who have risen through the ranks of a company after starting in an entry-level role. Although, firms typically award pay increases to promoted employees, some firms impose internal caps that limit the amount that an employee's pay can be raised as the result of a job promotion. Significantly, many firms routinely increase salary levels for external applicants whenever the average cost of living rises or falls. Therefore, an area manager's salary may depend in part on whether the individual was an internal or an external applicant for the job.

Many businesses prefer to hire individuals who have completed college degree programs and people involved in area manager roles often have business administration or management degrees. Some firms pay higher wages to individuals who have also completed advanced degrees. Additionally, someone working for a medical firm may need to have both a medical related degree and a business diploma. People with impressive academic credentials are often paid more than their counterparts.

Certain types of industries are by nature more complex than others. Someone working as an area manager at a scientific research firm may have had to spend many more years in college than someone who works in a similarly titled role for a retailer. Additionally, supply and demand can have an impact on an area manager's salary since companies are more likely to pay a premium to attract a manager if very few people within the local job market have the requisite skills to take on the specific job.

Area managers normally oversee people, processes and production although some firms divide these responsibilities between several people. Someone who oversee sales may receive part of their compensation in the form of commission in which case such an individual may have a lower base salary than someone else who is primarily concerned with operational issues. Another factor than can impact an area manager's salary is the size of the region that he or she presides over. Someone who manages multiple units and dozens of employees may be paid more than someone who only manages a few employees located within a small geographic area.