Market Rate
The going rate for a specific job in a specific location, what employers are actually paying for a given role, based on supply and demand in the local labor market.
Market Rate is a term from U.S. wage and occupational data — typically a concept from the BLS Occupational Employment and Wage Statistics survey, the DOL prevailing-wage system, or related employment statistics. The definition here is the practical worker-facing meaning. Understanding Market Rate is part of reading wage data defensibly. BLS and DOL conventions can be subtle — survey methodology, reporting thresholds, geographic definitions, and percentile calculations all shape what the headline numbers actually mean.
Each role-and-city page on SalaryTruth surfaces the Market Rate-relevant values for that specific combination, so the general definition here translates into concrete numbers on the per-role-and-city pages.
How It Works
Market rate represents the intersection of what employers are willing to pay and what workers are willing to accept for a given role in a given geography. It's not a single number but a range, typically spanning from the 25th to 75th percentile of BLS data. Employers determine market rate using compensation surveys (BLS OEWS, Radford, Mercer, Aon Hewitt, Payscale), competitive intelligence, and their own hiring experience. A company's compensation philosophy determines where they target within the market range: "market match" (targeting p50), "market leader" (targeting p75), or "market lag" (targeting p25, compensating with other benefits). Understanding market rate is essential for both employers and employees. Employers paying below market rate experience higher turnover and longer time-to-fill positions. Employees earning below market rate have leverage to negotiate raises or seek better-paying positions. SalaryTruth shows the full BLS percentile range for every role and city, giving you an objective view of the market rate rather than relying on self-reported data or anecdotes.
Related Terms
- Salary Range, The minimum to maximum pay an employer is willing to offer for a position, increasingly required by law to be disclosed in job postings in many states.
- Salary Percentile, Your position in the salary distribution, the 75th percentile (p75) means you earn more than 75% of workers in the same role. BLS reports p10, p25, p50, p75, and p90.
- Salary Negotiation, The process of discussing and agreeing on compensation with an employer, where research shows most people leave 5-15% on the table by not negotiating or negotiating without data.
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About This Definition
This definition is part of the SalaryTruth Salary & Career Glossary, 25 terms explaining compensation, salary data, and career development. All salary data from the Bureau of Labor Statistics OEWS survey.