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In most organizations, cost accountants focus on technical financial details that help businesses keep their costs in check. This expertise is valuable for companies looking to reduce or maintain expenditures.
Cost accountant salary levels vary depending on a number of factors. These include education and experience. Location-related factors like local job demand and the cost of living also impact average salaries for these professionals.
Our guide provides a detailed analysis of cost accounting salary trends. We focus on how cost accountants can maximize their earning potential and show areas with high cost accountant employment.
How Much Does a Cost Accountant Make?
Cost Accountants: $59,350
Average Annual Salary, September 2022
Source: Payscale
September 2022 Payscale data for the average cost accountant salary in the United States accounts only for base pay. The figure does not include performance bonuses and other forms of compensation. Cost accountants on Payscale report additional earnings ranging up to $8,000 per additional income source.
Cost accountants, specialized accounting professionals, earn higher average salaries than their general accountant counterparts: In September 2022, Payscale reported the average salary of a U.S. accountant is $52,780 per year, about $6,500 lower per year than the average cost accountant salary.
Cost Accounting Salary by Education
Among the steps for how to become a cost accountant are education and professional certifications. Cost accountants usually hold at least a bachelor's degree in accounting or a closely related business field. Some professionals also pursue a master's degree in business or accounting. This allows learners to build specialized knowledge.
Instead of — or in addition to — advanced degrees, some accountants earn professional certifications. These credentials validate specific skills, knowledge, and professional ability. Some certifications may be required in certain settings: For instance, cost accountants who create financial statements filed with the Securities and Exchange Commission must be licensed as certified public accountants (CPAs).
In addition to CPA designation, cost accountants can also earn certified management accountant (CMA) credentials. These credentials are not required in all cost accounting roles. However, they can boost a cost accountant's earning potential, as shown in the table below.
For the salaries below, note that this data covers all professionals with these degrees, not just cost accountants.
Salary by Experience
Payscale data shows that the average salary for cost accountants rises as these workers accrue professional experience. Accountants in the early career stage (1-4 years of experience) earn base salaries almost 10% higher than entry-level cost accountants who have been working less than a year.
Salary trends show the highest increase between early and midcareer, where cost accountants working at least five years earn $7,000 more per year than those with only 1-4 years of experience.
Because job performance tends to improve with experience, cost accountants with multiple years of experience may more easily qualify for bonuses and other forms of extra compensation.
Salary by Location
Location can significantly impact a cost accountant's salary. Wages are typically higher in areas with increased demand for cost accountants. Employers in these regions usually offer higher pay to attract professionals with cost accounting skills.
Cost of living also influences salaries. Jobs tend to pay more in areas with higher living costs. Because these places are more expensive, however, cost accountants' higher salaries may have lower buying power.
The U.S. Bureau of Labor Statistics (BLS), which tracks salary and job volume information across hundreds of employment categories, includes cost accountants within its general "accountants and auditors" group. The stats in the table below include BLS data for all accountants and auditors.
| State | Number of Accountants and Auditors Employed | Average Annual Salary |
|---|---|---|
| District of Columbia | 9,200 | $110,240 |
| New York | 111,660 | $105,790 |
| New Jersey | 42,230 | $97,950 |
| California | 151,320 | $92,840 |
| Massachusetts | 38,140 | $92,310 |
Source: BLS
| Metropolitan Area | Number of Accountants and Auditors Employed | Average Annual Salary |
|---|---|---|
| San Jose-Sunnyvale-Santa Clara, CA | 13,850 | $112,830 |
| New York-Newark-Jersey City, NY-NJ-PA | 117,800 | $109,330 |
| San Francisco-Oakland-Hayward, CA | 23,970 | $107,540 |
| Washington-Arlington-Alexandria, D.C.-VA-MD-WV | 41,850 | $99,640 |
| Midland, TX | 1,090 | $95,380 |
Source: BLS
Where Should I Work as a Cost Accountant?
The BLS projects 6% employment growth for accountants and auditors from 2021 to 2031, as fast as the national rate of growth for all occupations. This equates to 136,400 job openings per year during this time period.
Accountants and Auditors: +6%
Change in Projected Employment from 2021-2031
Source: BLS
The BLS identifies several trends of interest to specialist accountants. These include:
- Continuing economic growth and diversification
- Globalization
- Increasingly complex tax policy
- Evolving regulatory and compliance standards
The BLS believes the net effect of these factors will drive positive growth for accounting professionals. However, the agency also notes that its growth projections depend heavily on overall economic performance. Economic downturns can lead to fewer job openings as companies lower their budgets in response to financial difficulties.
At the same time, some parts of the United States expect local demand for accountants to exceed national averages. Cost accountants may want to research job openings in these regions when planning their careers.
Best Areas
Job opportunities for cost accountants tend to cluster in urban areas. BLS data for accountants and auditors lists California, New York, Texas, Florida, and Pennsylvania as the five leading states for overall employment. All five states are among the nation's most populous, boasting multiple major urban centers and robust economies.
Employment density offers another way to analyze local accounting job markets. The BLS tracks employment density in two ways: employment per 1,000 jobs and location quotient.
Employment per 1,000 jobs counts the number of accounting and auditing jobs for every thousand jobs in a given area. Location quotient measures local employment density by comparing it to the national rate for that job. For example, a location quotient of 1.10 means the job in question is 10% more common in that area than in the nation overall.
BLS data from 2021 identifies the following five areas as having the highest employment per 1,000 jobs and location quotients in the United States:
| State | Number of Accountants and Auditors Employed | Employment of Accountants and Auditors per 1,000 Jobs | Location Quotient for Accountants and Auditors | Average Annual Salary |
|---|---|---|---|---|
| District of Columbia | 9,200 | 13.90 | 1.49 | $110,240 |
| Colorado | 36,060 | 13.76 | 1.47 | $85,880 |
| South Dakota | 5,530 | 13.12 | 1.40 | $70,190 |
| Rhode Island | 5,910 | 12.92 | 1.38 | $88,350 |
| New York | 111,660 | 12.88 | 1.38 | $105,790 |
Source: BLS
The following tables detail which states employ the most accountants and auditors, as well as the states where these professionals' job openings are projected to grow the fastest. The data from the BLS and Projections Central covers all accounting and auditing jobs, including cost accountants and all other accounting and auditing generalists and specialists.
| State | Number of Accountants and Auditors Employed | Average Annual Salary |
|---|---|---|
| California | 151,320 | $92,840 |
| New York | 111,660 | $105,790 |
| Texas | 104,490 | $85,860 |
| Florida | 79,380 | $76,320 |
| Pennsylvania | 54,530 | $79,200 |
Source: BLS
| State | Percent Projected Change, 2020-30 | Average Annual Openings |
|---|---|---|
| Greatest Projected Percentage Increase | ||
| Utah | 33.4% | 1,800 |
| Colorado | 22.8% | 4,580 |
| Florida | 22.7% | 9,560 |
| Arizona | 21.6% | 2,990 |
| Massachusetts | 21.6% | 4,690 |
| Most Projected Average Annual Openings | ||
| California | 12.9% | 16,960 |
| New York | 16.5% | 13,510 |
| Texas | 20.2% | 12,990 |
| Florida | 22.7% | 9,560 |
| Illinois | 10.7% | 5,470 |
Source: Projections Central
| Metropolitan Area | Number of Accountants and Auditors Employed | Average Annual Salary |
| New York-Newark-Jersey City, NY-NJ-PA | 117,800 | $109,330 |
| Los Angeles-Long Beach-Anaheim, CA | 59,470 | $89,700 |
| Washington-Arlington-Alexandria, D.C.-VA-MD-WV | 41,850 | $99,640 |
| Chicago-Naperville-Elgin, IL-IN-WI | 38,800 | $81,250 |
| Dallas-Fort Worth-Arlington, TX | 34,070 | $87,720 |
Source: BLS
Best Industries
Accountants and auditors work across industries. However, some sectors employ more of these professionals than others. For instance, BLS data from 2021 shows that nearly 25% of U.S. accountants and auditors work for firms that provide accounting, auditing, and payroll services.
Some industries also pay accountants higher average salaries than others. For example, BLS data in the table below identifies oil pipeline transportation as the top-paying U.S. industry for accountants and auditors. However, this industry employs a relatively small total number of accounting professionals — only 40, much lower than the over 325,000 accountants who work in the top-employing industry.
The following tables summarize BLS data for all accountants and auditors:
| Industry | Number of Accountants and Auditors Employed | Average Annual Salary |
|---|---|---|
| Pipeline Transportation of Crude Oil | 40 | $123,230 |
| Computer and Peripheral Equipment Manufacturing | 2,770 | $123,210 |
| Other Information Services | 4,770 | $112,900 |
| Securities, Commodity Contracts, and other Financial Investments and Related Activities | 30,990 | $107,610 |
| Federal Executive Branch (OEWS Designation) | 22,260 | $107,170 |
Source: BLS
| Industry | Number of Accountants and Auditors Employed | Average Annual Salary |
|---|---|---|
| Accounting, Tax Preparation, Bookkeeping, and Payroll Services | 326,570 | $86,650 |
| Management of Companies and Enterprises | 104,760 | $84,820 |
| Local Government (Excluding Schools and Hospitals, OEWS Designation) | 45,290 | $73,860 |
| State Government (Excluding Schools and Hospitals, OEWS Designation) | 42,240 | $70,830 |
| Real Estate | 38,290 | $82,090 |
Source: BLS
FAQ About Cost Accountant Average Salary
Do cost accountants make good money?
As of September 2022, Payscale reports the average base salary of a U.S. cost accountant is $59,350 per year. This is higher than the national average salary for all occupations.
What is the expected salary range of a cost accountant?
Payscale reports the median salary (50th percentile) for a U.S. cost accountant is $59,000 as of September 2022. Cost accountants in the 10th percentile earn $46,000 per year, while those in the 90th percentile earn $79,000 per year.
What is the best industry to work in as a cost accountant?
According to the BLS, some of the highest-paying industries for accountants include pipeline oil transportation, computer manufacturing, and information services. The BLS also reports accounting services, business management, and local and state governments are among the top-employing industries for accountants.
Are cost accountants in demand?
Overall, the BLS projects 6% employment growth for accountants and auditors from 2021 to 2031. According to Projections Central data, accountant and auditor careers are projected to grow more quickly in some parts of the United States from 2020 to 2030, including Utah (+33.4%), Colorado (+22.8%), and Florida (+22.7%).
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