Reposted from https://www.moneygeek.com/careers/resources/salary-negotiation/
You don’t need to accept a company’s opening offer. Learn how to negotiate for the salary you want and deserve.
Though there are some things in life you can’t negotiate — like your tax bracket or the inflation rate — your salary isn’t one of them. Negotiation is a standard part of the hiring process when you’re starting a new role. However, a 2020 Glassdoor study found that 59% of American employees did not negotiate their salary. And gender plays a role: of the one in 10 U.S. employees who negotiate and successfully get a raise, men are three times more successful than women.
Asking for a raise or negotiating your salary at a new job can seem daunting, but some tricks and tactics can help you go into it more confidently.
US Salary Negotiations Facts
If you’re feeling apprehensive about asking for a raise, you’re not alone. It turns out there are several factors that influence how likely you are to ask for a raise. There’s hope you’ll succeed as more businesses are doling out raises in 2022.
Sources:Robert Half, Payscale
Why Should You Negotiate Your Salary?
Even if you’re intimidated by negotiating your pay, it’s an essential part of your career and getting the compensation you deserve. Depending on your company’s potential for growth and other factors like the economy, getting higher pay without leaving your company down the line could be more difficult if you don’t start at a decent pay level. Starting at a pay level you’re comfortable with can give you a sense of motivation, and as you progress and move forward with the company, you can later ask for a raise that aligns with your expectations.
Starting on the right foot is important
If you don’t feel comfortable with the pay you’re offered, it may be more difficult to put your all into a new role. Starting out at a salary you’re comfortable with lets you put your best foot forward at a new job.
Asking for a raise shows confidence
Taking the initiative to ask for a pay raise, along with noting your accomplishments that warrant asking for a raise shows you know your worth.
It sets you up for future success
Starting out at a higher versus lower salary means when you do receive performance or annual raises, you’ll be happier with them. This can help you stay motivated at your current job if you like the work, so you avoid job-hopping solely for the sake of finding better pay.
A 10-Step Plan for Negotiating Salary
Like anything else, going into salary negotiations feeling prepared is your best bet. Taking steps to calm your nerves so you come off self-assured can go a long way in projecting confidence to your employer — even if you have to fake it till you make it.
Keeping an upbeat attitude and remembering to treat your boss or hiring manager with the utmost respect should keep you in the right state of mind to negotiate. Being polite can help you avoid coming across as pushy, and if you start to feel intimidated, remember that your boss ultimately wants you to be happy in your position so you’re at your most productive. Higher pay can be a great incentive to keep employees motivated.
Your chances are high to receive the pay you want, especially in certain underserved professions. According to a 2022 Payscale report, labor shortages stemming from the COVID-19 pandemic have companies scrambling to attract and retain employees. 92% of businesses are giving raises in 2022, which is up 7% from 2021.
It can be helpful to research your profession and industry before settling on a number. Begin by checking the salary ranges on job postings for your profession. Working for public organizations versus private can make it easier to find salary ranges because they have to be more transparent about pay.
Depending on where you’re located, private employers may be required to post salary on job listings, like a bill passed earlier in 2022 in New York City. Federal, state and local government worker salaries are open public records. You can check with your state or local government or check FederalPay.org for federal employees. And aside from internet research, don’t forget about word-of-mouth — speaking with coworkers or fellow workers in your professional networks can also give you helpful knowledge.
You’ll need to prepare how you’ll respond if the hiring manager asks about your current or previous salary. Stay calm and remember you are not obligated to disclose your pay history. You can keep your response vague and say your pay has varied based on the type of work and position you’ve held. You could also give a salary range instead of an exact figure — for instance, $70,000–80,000 — to provide you with some flexibility.
What is the lowest amount you’d be willing to accept? Have that figure in mind before you enter salary negotiation talks. It can be helpful to research your budget and the cost of living in your city to ensure you pick a comfortable, liveable wage. You’ll also want to consider other job factors, such as commuting and paid-time-off allowance. If you don’t receive your desired salary, are there other perks you could negotiate, such as extra PTO or more work-from-home days per week?
Whether you improved your last company’s bottom line or have garnered awards for your work, salary negotiations are the time to discuss your strengths and accomplishments. It can be helpful to compile a list of your achievements and commit them to memory so you can speak about them comfortably when asked for a rationale for a pay increase or salary bump.
Timing your salary negotiation talk may not always be possible, but when it is, you should choose a time when your boss is relaxed and free to talk. So a day filled with back-to-back meetings is probably not the best time to spring a discussion on them. Be sure to schedule it with plenty of notice and accommodate your employer’s schedule and time demands.
There are a few courses of action if your request is not approved, but a counteroffer is made. You can choose to maintain your position and ask for a higher offer, you can negotiate further to meet in the middle or you can accept the counteroffer. Be sure to accept the counteroffer graciously, whether you plan to take it or not.
Proven Salary Negotiation Strategies
There are definite dos and don’ts to asking for a raise or negotiating your pay. While some of the work happens while you’re in the room, much of it is in the preparation for salary talks that you’ll complete on your own beforehand. It’s important to keep a positive attitude and frame of mind as you negotiate.
It’s essential to research salary ranges and what pay is like in the current market before you go into salary talks. You can also come up with a list of reasons for your valuation.
Check resources for your particular job field to see what the market is currently paying. You should also look at your specific title and see any open job listings and if they list the salary range, as some employers in some areas are required to do. Make a list of accomplishments in your current or previous role that apply to your pay request and can strengthen your appeal for higher pay.
Factor in Your Prior Experience
Every position you’ve ever held contributes to your experience and expertise. It’s important to look at your overall experience versus focusing on your achievements in the past year. The more reasons you can gather to warrant a pay increase, the better your chances should be of receiving what you ask for.
Focus on your strengths. Do you have extensive experience in one area that is important to your current company? Have you worn many hats in previous roles? Everyone has strengths that can be desirable to employers and sets them apart. It can even give you a bit of a confidence boost by looking at all that you have done in your career, which will help you go into the talks feeling more self-assured and comfortable.
Remember to Collaborate
How you approach negotiating is very important. A collaborative attitude is always a desired trait in the workplace, particularly with negotiation. Posing your request to your employer so it’s framed like a win-win for both parties can be a successful method. Although your employer is technically giving up something (more pay), you want it to seem like the value they’re receiving outweighs the pay increase.
It’s always a good idea to bring more value to the table than what you take away, and finding a way to communicate this to your employer is an excellent place to start. That’s why creating a list of your values can show your prospective employer what they stand to gain by giving you the salary you want.
Negotiating Your Salary When You Don’t Have Much Experience
Negotiating your salary is nerve-racking for all employees and candidates, but especially so if you don’t have a lot of experience. Even if you’re fresh out of college without much experience in the workforce and are starting your job search, it’s still important to negotiate, so you don’t accept an offer that’s lower than what you deserve.
When accepting your first job offer, it can be tempting to take what you can get. But be sure to prepare so you don’t accept a lowball offer or get into a position where you’ll be overworked and underpaid. Playing to your strengths is important, as well as knowing the going rate in your new field.
- Research the job market: Even if you are taking an internship, it can be helpful to see what the job requirements are for similar positions and the compensation.
- Focus on your talents: While you may not have much experience, highlight life skills you can use to your advantage. For example, if you’re a new graduate, you can talk about courses you excelled at or new programs or technologies you are versed in.
- Practice confidence: Though you may not have negotiated before, projecting a calm, confident demeanor can go a long way. Pause to think before responding to a question, and try your best to calm any jitters that can derail your focus and calm.
What to Say During Your Negotiation
Whether you’re negotiating with a new employer for a starting salary or asking for a raise, it’s best to lead with how excited or happy you are to be on the team and why the job is important to you. While the best way to discuss important matters with an employer is typically during a face-to-face meeting, in the age of remote work, that may not always be possible. Turning on your camera during a Zoom call can create personal interaction even at a distance. If there’s no way to have a face-to-face meeting or virtual call, then you can still have an effective negotiation by phone or email.
Words and Phrases to Use in Different Situations
If you’re feeling stuck, try using these phrases and questions to open up your negotiation conversation. It can be helpful to have a script in mind to stick to if your thoughts go off-course or you’re feeling nervous, even as you naturally go with the flow of the conversation.
I’m excited at the prospect of coming onboard and getting to know the team.
Saying something that shows you are looking forward to collaborating can go a long way with an employer who wants to know if you’re a team player. Also, starting with a few opening lines about the work and value of the company rather than strictly the compensation can show that your mind isn’t just on the money.
It has been (length of time) since my last pay review, and based on my increased responsibilities and average salary for the industry, I’d like to request a raise to (amount).
If you’re negotiating for a raise, you can justify the reasoning that you have researched the going rate for your industry and title, and note that your responsibilities have increased or the scope of your role has expanded.
With my background/experience and the role’s responsibility, I’d like (desired salary).
It’s not the time or place to discuss your rising rent or grocery costs. It’s best to state your desired salary simply and plainly, with the justification being the value you bring to the table.
Thank you for the offer. If you can move to (desired salary), I would be happy to accept the role.
You can say this if a counteroffer is made that doesn’t meet your expectations.
Is there any flexibility in the compensation package?
If the offer isn’t exactly what you bargained for and it doesn’t appear the employer will budge on it, you can see if there are other perks you can negotiate for, such as working from home, extra paid time off or other flexibility.
How Much Should You Ask For?
A standard raise can be anywhere from 3%–5%. Performance raises can be above that amount; however, they vary by company and field. It’s important to research the going rate for your title in your specific industry. Ideally, you’ll do some background research before you come up with a figure and present it to your prospective or current employer.
Determine Your Worth
Though it can be tempting to throw out a high number, you want your employer to know you’re serious and have done the research about a fair rate.
- How much is a starting salary for your field? Starting at the base pay for an entry-level position in your field can give you a number to work from.
- How much is a mid-level salary? Similarly, knowing the average mid-level salary will help you get a framework for your expected pay. Remember that salary varies by many factors, which may be a range versus a single dollar amount.
- How much is a senior-level salary? Knowing the top level for your position can help you plan and understand what you can work toward or achieve now.
- How have my contributions helped my department or the company? Thinking about your past performance reviews and your outstanding mentions or notable accomplishments can help fuel your mission for higher pay and give your employer justification for raising your rate.
5 Areas You Can Negotiate Besides Salary
There are other factors that go into a great compensation package other than the salary. Consider negotiating for other perks that are important to you. These can be used as bargaining tools if you cannot meet at a salary you’re comfortable with.
Flexible work hours
Maybe you’re a parent and would like to have the option to work flexible hours that work with your childcare situation. Checking if there’s any flexibility for the hours you work, such as having the ability to start earlier and leave earlier, can make up for a less than stellar compensation package.
Since the COVID-19 pandemic, many more employers have offered remote or hybrid work. Negotiating for work-from-home days or an entirely remote schedule could be a good way to seal the deal and make you and your employer happy.
If you’re applying for a job from a distance, you can see if your company offers coverage for your relocation costs. This can help ease the financial burden of moving to a new area for a job.
Perhaps you can negotiate for additional paid time off. An extra week of vacation could be the tipping point if you can’t agree on a salary.
Does your company offer reimbursement for public transit or mileage costs? These can offset your commuting costs and add up to some savings.
Common Mistakes to Avoid When Negotiating
There are some pitfalls to look out for when negotiating your pay. Avoiding these common mistakes can keep you on the right track in your negotiation and prevent giving your employer any reason to deny your requests.
Even if you’re eager to accept a position, you want to give yourself room to negotiate a better offer. Thank the employer for the offer, and if you feel pressured on the spot, ask for a day to think about it to give yourself time to prepare to negotiate.
You’ll need to thoroughly prepare for your salary negotiation with a number in mind that is drawn from market research and calculating your own worth to the company.
It’s not the time to be humble or self-effacing. Be sure to come prepared with a mental list of what you’ve accomplished and the value you’ve brought to the company or previous roles.
Using a resource like Glassdoor or open records can help you ascertain how much the company in question pays for salaries. If you know the market rate is significantly higher than what they’re offering, you may not have luck with your negotiation and may want to rethink either the job or your expectations.
Once you come up with a bottom-line number that you need to feel comfortable accepting the job, you have to be willing to walk away from the opportunity if the employer cannot or will not match that.
When Is the Right Time to Negotiate?
Timing is definitely important when negotiating. The right time will depend on where you are in the hiring process and when your employer is not rushed. You probably don’t want to go back and forth with counter offer after counteroffer, so having the number you want and a number you won’t fall below in mind can help make for an efficient negotiating process.
- The salary does not reflect your experience. If you’ve recently taken on more responsibility at work or received a title change without a pay increase, it is a good time to ask for a raise. You have excellent justification to explain to your employer why you deserve additional pay.
- You’ve contributed to the company’s success. Has your company been having a windfall and doing better than ever? If you’ve had meeting after meeting about how revenue is up and everyone’s contributions have been successful, this can be a good time to ask for a raise. Economically favorable circumstances are always better for asking for what you want than when a company is doing poorly.
- Another company has made an offer. This one is tricky because while a competing offer gives you leverage, you don’t want to mention one to your current company unless you’re willing to leave. Why? This shows your employer you have been job searching and things can be awkward if you do decide to stay.
- Another company has made an offer and you’re still in job talks. If you’re in negotiations with a prospective employer, you can thank them for the offer and inform them that you’re interviewing with multiple companies. Then, you can ask if they can match your desired amount. This gives you greater leverage since the company knows you’re in demand. Note, if you’re trying to get a raise with your current employer, this does not apply.
Q&A With a Career Coach
When you’re looking for insider knowledge on getting the best salary, who better to consult than a career coach? MoneyGeek spoke with established experts who coach their clients on improving their career prospects.
- What are some common mistakes employees make when negotiating salary?
- What is your best tip for going into salary negotiations?
- What if your current employer makes a counteroffer to keep you?
Career Counselor at The Lookout Point, LLC
Christine Michel Carter
Author and Independent Career Coach at CMC
Karen James Chopra
Career Coach at Chopra Careers
Responding to an Unsuccessful Negotiation
When you go into negotiations, you hope for the best possible outcome, but not all negotiations are successful. If you’re unable to receive an offer that aligns with your expectations, know that you still have options.
Provide a counteroffer
Maybe the amount you first requested was denied, but there is still an opportunity to compromise and come up with a figure that works for both you and your employer. Before you enter negotiations, you must have a counteroffer in mind if they do not accept, so you can swiftly attempt to reach a compromise.
Ask for other benefits
If your counteroffer is refused and you’d still like the position, it’s worth asking about other benefits you can negotiate. Maybe you would be comfortable accepting the salary they offer if you can work a flexible schedule, for instance.
Decide how to proceed
If the salary offered does not meet your expectations, it may be time to walk away and find another job that better suits your needs and valuation.
Salary Negotiation Advice for Women
Salary negotiations are complex for everyone. Still, women may face additional challenges because of stereotypes associated with women in the workplace. Many of these challenges can be an issue of confidence in individual worth: women report salary expectations between 3%–32% lower than men for the same job, according to a report by UC Davis Advance. Feeling confident in salary negotiations and knowing your worth is an essential first step toward getting the financial compensation you deserve as a woman.
Overcoming Gender-Specific Challenges
Women were paid 83 cents for every dollar earned by a man in 2020, making it ever so important for women to speak up about the wage gap and to get the pay they deserve.
Don’t second-guess yourself or the wage you want. The more confident and comfortable you feel about the salary you’re requesting, the more at ease you will feel when it comes time to negotiate.
If you can, try to find out what men in your field or at the company in question earn. This can give you a guideline for how much you should earn — because you should absolutely earn what a man in your exact position would.
You’ll want to have clear documentation of your achievements at work for your salary negotiation. It’s helpful if you can compile it in a spreadsheet or some other quantifiable way, so there is no doubt about your role in those achievements.
Expert Insight on Salary Negotiation
Business leaders’ and owners’ perspectives on how best to negotiate can be invaluable in your preparation for salary negotiations. MoneyGeek spoke with leading finance experts on the dos and don’ts of negotiating your salary.
- Is there a right and a wrong way to negotiate your salary when starting a new role?
- What should an employee do if their salary request is denied or a counter offer is made that doesn’t meet their expectations?
Fractional COO of Kamyar Shah
Certified Financial Planner and Owner of Spark Financials
CEO & Founder of Finance Hire
Kenneth Chavis IV
Certified Financial Planner and Senior Wealth Manager at LourdMurray
CEO of Riva
HR Manager at Fuseideas
Additional Resources for Negotiating Salary
Having a strong understanding of financial topics can help you determine what your salary needs are and what you should ask for. The following guides can help you learn more about industry and salary standards.
Career and Industry Resources
- Bureau of Labor Statistics’ Occupational Outlook Handbook: Check current salaries across different industries using the search tool here. You can also check the growth rate and projected number of new jobs.
- Glassdoor.com: Apply for jobs, view company ratings and reviews from current, former and prospective employees and salaries for job titles at specific companies.
- JobStar.org: Find job search resumes for different cities, including help with resumes and cover letters.
- OpenPayrolls: Search the salary database for careers nationwide. You can search by employer type or by the employee.
- State of New Jersey Transparency Center: Though this guide is for the state of New Jersey, you can check with your state’s public payroll record to see payroll data.
- U.S. Bureau of Labor Statistics: See economic regions’ news, such as inflation and the unemployment rate.
- FederalPay: Check pay information for employees of the federal government. You’ll also find information on per diem rates and a federal holiday schedule.
- Indeed Salary Insights: Indeed clearly posts the average salary for a position in its headline, making it easy to get a quick idea at a glance about pay.
- MoneyGeek’s Cost of Living Calculator: See what kind of salary you’ll need to earn to live comfortably in your city. MoneyGeek lets you compare expenses across large and mid-size U.S. cities.
- LinkedIn Salary: See salary insights and submit your own salary to help others in the same position. You can also navigate to the Jobs tab in the LinkedIn app or to a job posting to see listed salary information.
- PayScale.com: View annual reports on compensation trends to see what is happening across the market as far as raises and challenges in the workforce.
- PayScale Salary Reports: PayScale offers an interface that assists with salary information like market value, allowing you to input education and job skills.
- Robert Half Salary Guide: The 2022 guide outlines projected starting salaries for more than 500 positions across several industries.
- Salary.com: A resource for employers and employees to see what constitutes fair pay across many industries.
- SalaryExpert.com: Another resource for employers and job seekers to find compensation data to help in their job or candidate search.
About the Author
- Glassdoor. “Glassdoor Survey Finds 3 In 5 U.S. Employees Did Not Negotiate Pay In Current/Most Recent Job – Fewer Women Negotiate Than Men.” Accessed June 18, 2022.
- Robert Half. “Ask for a Pay Raise…Or Get a Root Canal?.” Accessed June 21, 2022.
- Payscale. “2022 Compensation Best Practices Report.” Accessed June 21, 2022.
- Spectrum News. “City Council Passes Bill to Mandate Salary Transparency in Job Listings.” Accessed June 21, 2022.
- Algrim. “What Is a Reasonable Average Raise Percentage to Ask For (2022).” Accessed June 22, 2022.
- UC Davis Advance. “Women Don’t Ask: Negotiation and the Gender Divide.” Accessed June 22, 2022.
- U.S. Census. “Income and Poverty in the United States: 2020.” Accessed June 22, 2022.