Companies across the world know how important it is to collect data and then to make decisions based on this data. Data allows businesses to understand industry trends, what customers want, what competitors are doing, and even how employees are doing and what their needs are.
However, in order to analyze and to make effective decisions, businesses need to invest in qualified business analysts to help them.
Business analysts evaluate huge amounts of data to help companies optimize their business processes, to integrate new IT systems into their companies, to adapt to changes, and to help businesses reach their objectives.
With this in mind, it is not surprising to hear that business analysts are in high demand worldwide today. According to the U.S. Bureau of Labor Statistics, on average, 99,400 new job openings a year are projected to appear on the job market over the next decade. In addition to this, a career in this field is also very promising, and the role of a business analyst often pays very well.
Today, I will discuss with you what business analysts do, how much they earn, what factors impact their salaries, and how to become a business analyst.
Note: All figures were correct at the time of writing.
What Does A Business Analyst Do?
The role of a business analyst is to help companies become more profitable by looking for, and finding, areas where the business could improve. They also help businesses solve existing problems and to reach their goals faster.
These professionals evaluate business data, analyze an organization’s needs, develop optimization strategies, and help companies implement necessary changes into their processes, structures and IT systems.
Their primary duties include:
- Assessing a company's current processes, technologies, financial data and employment reports.
- Identifying business opportunities and discovering areas for improvement.
- Finding the root cause of problems and researching possible solutions.
- Defining and prioritizing requirements.
- Conducting business modeling.
- Presenting any findings to different stakeholders by using charts, graphics and other data visualization techniques.
- Overseeing the development and implementation of new solutions.
- Ensuring project deliverables meet a business’ objectives.
- Gathering feedback to check that changes are working as planned.
Thanks to a business analyst’s expertise, a company can rest assured that the requirements for a particular project and their strategic business goals are aligned. And that, in turn, helps to reduce project cost, increase a team’s efficiency and improves the overall quality of the final product.
Let’s take a look at how much a business analyst earns per year.
Average Business Analyst’s Salary
According to information provided by recruitment sites, an average business analyst’s salary ranges between $62,543 and $95,672. These sites regularly update their figures, so be sure to click on the links below for real-time data regarding a business analyst’s basic wage.
The table below shows how a business analyst’s basic salary varies across different sites:
Despite the fact that a business analyst’s salary ranges, professionals working in this field typically make more than the United States’ national average wage, U.S. Bureau Of Labor Statistics (2020). However, how much a business analyst makes depends on many factors, including, what certifications a person has, what additional skills an individual has, where they are located, any other education an individual has, and what company a person works for.
Each and every one of these factors must be considered before you can determine exactly what a business analyst gets paid.
Let's take a closer look at how some of these factors impact the salary of a business analyst.
Average Business Analyst’s Salary: By Country
One of the most significant factors that impacts a business analyst's salary is the region where they work.
The table below demonstrates how salaries vary across 10 countries around the world (the figures have been adjusted from their local currency into US$ for ease of comparison):
As you can see the United States, Germany, and Australia offer the highest earning potential. And business analysts from Singapore and South Africa make significantly less. However, when comparing paychecks, you should consider the cost of living in different regions as this can impact how much people earn per year. Sometimes salaries in less expensive countries are not as bad as they look at first glance. It is also important to keep this in mind when thinking about relocating.
Further to this, if you compare salaries from within the U.S. alone, the salaries range. For example, according to Indeed, an average business analyst's compensation in Bismarck, North Dakota, is $66,474, while in New York it is $88,854.
The table below highlights the highest-paying cities for business analysts in the U.S.:
Location is an important factor when it comes to earnings. However, it is not the only one. Let's take a look at what else impacts a business analyst's salary.
Average Business Analyst Salary: By Company
Business analysts may have slightly different responsibilities in various organizations, and paychecks often reflect these differences. The table below outlines how annual salaries vary across some well-known companies:
So, you have now seen how location and company impact a business analyst’s annual salary, let's move on to the third significant factor - years of experience in the field.
Average Business Analyst Salary: Based On Experience Level
Experience is another factor that significantly impacts a business analyst's annual earnings. PayScale data shows that while the average salary for entry-level business analyst roles is $58,005, experienced professionals make on average $71,883.
A background in software development, sales, or management, and a deep knowledge of a particular domain, like finance, healthcare, or manufacturing can also positively impact a business analyst's earnings.
Salaries for Other Business Analyst Roles
As noted earlier, a business analyst's duties will likely vary across different industries and companies. And sometimes the boundaries between business analyst positions and other data-related roles are not so clear. That is why it might be helpful to look into salaries for similar job titles to get a better understanding of the earning potential this field has.
Here is a brief overview of the average salaries of various analytic and data-oriented jobs:
As you can see, regardless of the title, all these jobs are well-paid. And professionals who master the basics and move to more complex and senior roles can expect notable salary growth.
Now, you may be wondering about how to become a business analyst yourself, in the next section I will explain how you can become a business analyst.
How To Start A Career As A Business Analyst
To start a career as a business analyst, an individual needs a certain combination of education, technical knowledge and soft skills. In addition to this, relevant certifications will help an individual to land a new job or to get a promotion faster.
Many business analysts have a bachelor's degree in business administration, finance, accounting, statistics, or computer science. For more senior positions, employers might prefer to hire candidates who have a masters degree in business analysis.
However, if you do not have a formal education in any of the fields listed above it is still possible to get a job as a business analyst. You can learn the necessary skills by attending short-term bootcamps, completing online courses, or by signing up to and going to in-person classes.
A business analyst’s hard skills will likely vary depending on the technologies a particular company uses. But, in general, employers often expect proficiency with the following tools:
- Microsoft Excel
- Google Analytics
- Tableau, Power BI or similar BI tools
- Python or R programming language
In addition to the above, business analysts must possess a solid understanding of business processes, accounting, and finance, and have a deep knowledge of business analysis methodologies and techniques.
The key soft skills for business analysts are problem-solving, analytical and critical thinking, organizational and communication skills.
Several institutions provide certification programs designed for business analysts. Below is a brief overview of a few widely recognized programs:
Certificates from the International Institute of Business Analysis (IIBA). This organization offers different certificates to candidates based on their experience level in the field:
- The Entry Certificate in Business Analysis (ECBA) is for beginners.
- Certification of Capability in Business Analysis (CCBA) is for professionals with 2-3 years of work experience in the industry.
- The Certified Business Analysis Professional (CBAP) is for experts with more than 5 years of experience in the field.
This organization also provides several specialized business analysis certifications: Agile Analysis Certification, Business Data Analytics Certification, Cybersecurity Analysis Certification, and Product Ownership Analysis Certification.
Certificates from the International Qualifications Board for Business Analysts (IQBBA).
IQBBA focuses on business analysis for the tech field and offers two types of certificates:
- Certified Foundation Level Business Analyst (CFLBA) is for individuals with a basic knowledge of business analysis concepts and practices.
- Certified Advanced Level Business Analyst (CALBA) is for those who would like to advance their skills in areas like requirement management, process management, and strategic analysis and optimization.
Certificates from the Project Management Institute (PMI).
This organization offers a PMI Professional in Business Analysis (PMI-PBA) certification. This program is designed for professionals who manage requirements, define project outputs, and work closely with project teams. Business analysts must renew their PMI-PBA certificate every three years.
Certificates of the International Requirements Engineering Board (IREB).
IREB provides worldwide recognized certification in requirements engineering. And since requirements management is one of the main duties of a business analyst, many employers value their Certified Professional for Requirements Engineering (CPRE) program. This certificate is available at three different levels: foundation, advanced, and expert. And it has lifetime validity.
Earning one of such certificates not only makes professionals more competitive in the job market, but also increases their earning potential.
Gaining Some Work Experience
Candidates who, in addition to theoretical knowledge, have some real-world experience with business analysis can occasionally find their first job faster.
So, you should consider volunteering your services on projects, or participating in an internship program to gain valuable practice before applying for a full-time paid position.
Another option is to take on some business analyst responsibilities at your current job. For example, improving a business process, facilitating a meeting, structuring data, or designing use cases - all these activities will give you a lot of experience.
Despite the average salary of a business analyst varying across different websites, these professionals usually earn above the US’s national average salary. The main factors that impact a business analyst’s earnings are location, company, and years of experience in the field. Relevant certificates can also improve a professional's chances of getting a higher salary too.