Mean Wage definition

The mean wage is calculated by taking the sum of all wages in a data set and dividing by the number of wages in the data set. It is often taken as the 'average' wage, but is frequently an over or under-estimation due to the presence of extremes in the data.

The median wage is the more accurate estimate of the 'average' wage – this is the 50th percentile, calculated by lining up all wages in order and taking the figure with precisely half the rest the data above it and half below it. The advantage of the median wage is that its not skewed by extremes. Another related metric is the mid-range wage.