This is how pay is calculated using the salary calculator

Where do the numbers come from?

The earnings statistics are based on actual pay data from all financial sector employees.

In brief, we extract registers from Statistics Denmark, thus obtaining actual pay data of almost 71,000 employees in the financial sector, some of whom are members of Finansforbundet and some are not. This provides a significantly stronger data foundation, which is based on the pay data reported by employers to Statistics Denmark.

By combining the data extract with a membership survey, we are able to expand the number of job categories (especially in the insurance sector). Pay data from the membership survey is, moreover, used for the earning statistics covering Greenland and the Faroe Islands.

To convert the extensive data into pay estimates for each profile of the salary calculator, we use a quantile regression model. The consulting firm HBS Economics has selected the specification which provides the most accurate results.

How is pay calculated? 

We have calculated the pay as follows:

• Total pay = base salary + pension contributions (own contributions + employer's) + irregular payments (bonus and profit payments).
• The base salary includes basic allowances and allowances for qualifications and special duties, etc. as well as holiday pay and public holiday payments, increased holiday supplement, gross deductions and any “free choice” scheme payments.

To reach the value per month, some figures are initially determined as the payment for the entire past year and then divided by 12. This includes bonuses, profit payments and holiday supplement. The salary does not include overtime pay. We use the concept of pay defined by Statistics Denmark, which is "Standardised monthly earnings, excluding nuisance bonus". This concept of pay comes nearest to the monthly pay on the pay slip.

Pay elements?

The pay of the calculator comes from different pay elements. The table below displays our overview of pay elements, showing the share of pay deriving from, for instance, fixed salary, pension (both own and employer's contribution), irregular payments (i.e. bonus, one-time allowance, profit payment) and the holiday supplement.

The standard collective agreement applicable to the sector provides for total pension payment of 16.90% and a holiday supplement of 3.25%. Please note that the percentage in the table is lower as no pension and holiday supplement are paid on pension and holiday supplements, and, thus, the percentage of total salary is lower than that of the collective agreement.

What do median and quartile mean?

The salary you see shows four different pay levels. The four levels are called lower quartile, median, upper quartile and 90th quartile:

• The median shows the salary of the person in the middle when ranked with all the other people included in the statistics. Therefore, if you want to compare your salary to the typical salary of someone with your profile, you should look at the median.
• The lower quartile indicates the salary level below which 25% of employees are paid.
• The upper quartile shows what you should at least be paid to be in the top 25%.
• The 90th percentile shows what you should at least be paid to be in the top 10%.

Maybe you're wondering why we don't compare to the average? This is because the average may be heavily affected by even just a few people with an unusually high or low salary. This may give you a false picture of the general pay level. Hence, in general, the median is used when producing pay statistics.