The team at Rora helps top researchers and engineers negotiate win-win deals with tech companies and finance firms. On September 8, 2023, the Mignone Center for Career Success hosted Rora’s Sameer Siddiqi for a chat about the state of the STEM PhD and post-doc hiring market, particularly focused on tech and careers in AI. Sameer shared insights on the market, based on 400+ STEM PhD and post-doc negotiations that Rora supported over the last year, with companies like Google, Meta, Amazon, DeepMind, and Anthropic.
The event focused on these questions:
– How have offers changed due to the current market?
– Since it’s harder to line up multiple job offers, can PhDs and post-docs still negotiate? Using what leverage?
– What are the latest tactics recruiters are using to pressure candidates?
- Negotiation is about more than just compensation. It’s about building rapport with a potential hiring manager/team, and ensuring that the role you’ve been offered is a good fit for you.
- When possible, negotiate with your hiring manager, not the recruiter. The hiring manager is the one with the most influence to increase your offer – because ultimately they’re responsible for the team’s business outcomes.
- Every researcher has the leverage to negotiate. This is because there’s a fixed supply of tech researchers (because these roles often require a STEM PhD), but significantly increasing demand as companies look to leverage AI and emerging technologies.
- You don’t need multiple offers to negotiate successfully
The State of the Market
Hiring in AI and machine learning is booming. While we’re seeing a 55% drop in hiring in tech companies, that’s not the case for AI hiring. We’re still seeing an increase in demand for research scientists and machine learning engineers. This is because:
- There’s an explosion of start-ups and big tech companies looking for the best talent.
- New industry research labs continue to raise funding to recruit talent.
- Finance, Healthcare and other sectors are also looking to incorporate AI into their work.
- More companies are looking to introduce a chat bot.
- The global demand for these skills far outweighs the supply. Every year, about 1,700 CST PhDs graduate. According to the Computer Research Association, demand for research scientists and Ml engineers is growing about 20% per year. In five years, there will be 5000 more research scientist jobs than there are research scientists.
What has changed with the market?
- Students are less likely to receive multiple offers. In 2021, 60% of the candidates Rora supported had 2 offers. That’s dropped to 25% in the last 6 months (though this has more to do with timing misalignment, or different hiring timelines amongst tech companies).
- More just-in-time hiring – meaning a company will want to make an offer and have you start work within a few months.
- It’s a tougher negotiation climate, in part due to high recruiter turnover. You have to build rapport with a new recruiter, which makes negotiation tougher (since negotiation is about influence and relationships. So if you experience a change in recruiters, it becomes hard to negotiate because you have to build rapport once again from scratch).
- Recruiters are using the state of the market to justify lower offers.
- Initial offers tend to be closer to the bottom of the band.
- The biggest change we’re seeing is that people are a lot more scared to negotiate.
The different stages of the interview process:
- Sourcing stage (1-2 months) – You’re applying to companies
- Interview stage – This is one of the most important stages during negotiation. On average, it takes 1-3 months depending on the company.
- Research – This phase usually lasts less than a month. Here, you’re asking: is this the right team for me? You want to make sure you have the right manager, the right team, the right role.
- Negotiations: This phase generally lasts 1-3 months.
Components of most tech job offers:
- Most salaries will consist of base, equity, bonus. For an early career role, the salary will be made up of 75% base bonus, 25% equity. As the role increases in seniority, base gets capped, and equity will start to make up a larger percentage of the total compensation.
- For example, a Google Research Scientist (L5, remote) might be offered: $200K Base salary, $1.4 million (over four years) equity in the company (plus a signing bonus and relocation costs).
- These are big numbers, especially compared to a PhD stipend or a postdoc salary. So people might not even want to negotiate, because they’re afraid of losing the offer.
To keep in mind for negotiation:
- In a market like this, using market data isn’t necessarily the best way to negotiate – recruiters might respond with: “we’re not giving out those specific offers anymore.”
- So you might wonder: Should I even try to negotiate? That depends on your personal circumstances – the willingness to walk away from the offer is the strongest piece of leverage you can use.
- One of the biggest fears of negotiation is that it will jeopardize your relationship with the company, or that you’ll come off as greedy. People associate negotiation with firmly demanding higher pay.
- But we can shift this mentality and see negotiation more as a chance to learn about the company and strengthen your relationship with your future manager and the company.
- Having more conversations during the negotiation process can help an applicant better understand if this manager/team is someone they can really be successful working with.
- When you negotiate successfully, it’s a win-win situation (for you and the company/hiring team).
- Most of the time, PhDs think they should be negotiating with the recruiter. After all, this is the person they’ve had the most communication with (recruiter sets up interviews, gives them an offer). But recruiters are middle-people who have limited influence when it comes to changing an offer.
- So whenever possible, ask the recruiter to set up more conversations between you and the hiring manager. The recruiter’s job is to essentially make you accept the offer as quickly as possible. But the manager is the senior team member who is interested in hiring you – they will be your greatest advocate, because when they hire a talented candidate, business objectives are more likely to be achieved (talent is always more important than budget).
- So if you have the hiring manager’s support, you’ll be able to negotiate more successfully. If not, you will most likely not be able to negotiate. How the manager responds during negotiation conversations can help you gauge the manager’s ability to support and advocate for you in your role/career more broadly. So building a strong relationship with your manager is very important for a market like this one.
Sameer’s Negotiation Strategy:
- The Impact Road Map: the goal of the impact roadmap is to get on the same page with your manager about the scope of the role and the success, and what success would look like when you finish those specific success metrics. Here’s an example of one.
- Putting together an impact roadmap is a great way to show that you’re thinking strategically about the role and that you’re setting yourself up to be a high performer.
- While discussing your impact roadmap with the hiring manager, you can also see if the way the hiring manager gives you feedback is collaborative, helpful. etc. These are good signs!
- Before you ask for increased compensation, an impact road map helps you:
- articulate your ability to achieve the role expectations, and
- gain clarity on the challenges and goals of your job outside of the specific job description that you’ve seen.
- In other words, the road map helps you articulate why the company actually should give you more. How does it benefit them? The goal here is to create alignment of interests (rather than division).
- An Impact Road Map should include:
- Overview of your primary goal
- Your long-term career vision for your time at the company
- How do you want your career to develop 3-5 years from now?
- Your understanding of specific responsibilities
- An impact timeline: your goals & work for the first year (Month 1-3, Month 6, Month 12)
- Each month should include a ‘key goal/metric’ and the tasks you plan to work on.
What gets in the way of good negotiation?
Attachment! The more attached you are to the opportunity, the more likely it is that your negotiation will go poorly, because of the pressure you put on conversations.
So instead, try and stay a bit more detached from an opportunity you’re excited about. Some tips to help you detach and get perspective:
- Take a step back from the offer, speak to mentors, reflect on whether the role is the right role for you.
- Outline your negotiation principles before you get an offer, so you have something firm to stick to. For example: “I will not accept an offer for less than X,” or I will take at least 24 h away from the offer after receiving it and give myself time to think.”
- Explore the full competitive set. If you’re very excited about a company in the big tech space, reach out to the 5 more most direct competitors and try to drum up opportunities there as well. It may seem that you want to join Company A, but you might actually find more alignment in Company B. It’s always good to keep your doors open.
- Remind yourself that you didn’t know about this company more than X years ago. So while getting an offer is very exciting, remember that you’re okay without them, and you would be still okay if you didn’t get the offer.
- Be mindful of a scarcity mindset (“I will never find another opportunity as good as this one”). You can reframe those thoughts with an abundant mindset (“This is a good opportunity, but there will be future ones. I’ll be okay if I turn it down”)
A Guide to Negotiating Successfully:
- Understand your leverage.
- In negotiation, the acronym BATNA stands for your best alternative to negotiated agreement. If you don’t take the offer, what other options do you have? The higher your BATNA, the better your negotiation position.
- Determine your BATNA from the beginning of a job search. Once you determine it, stick to it!
- Understand the company’s leverage
- How many other candidates are interviewing for this position? You want to make sure that you understand where the company is with the hiring process before we start being quite aggressive with our expectations.
- Are the other candidates in the company with Offer stage? How do you compare with these act candidates? How much buy-in do you have with the team manager and the senior leaders?
- Bypass the recruiter and talk to the hiring team
- Companies design their hiring processes and compensation practices to prevent you from influencing your manager. You want to break that narrative and make sure that you ask the recruiter for multiple conversations with the hiring team.
- Choose judiciously. Be patient.
- We’ve seen offers change by hundreds of thousands of dollars, just because a candidate was willing to wait instead of jumping to respond immediately.
- Offer deadlines can often be negotiated.
How to lower the risk of getting an offer rescinded
- Offer rescinds happen very rarely.
- But the fear of getting an offer rescinded might prevent you from negotiating, especially if you do not have any other previous negotiation experience.
- Using an impact road map and building rapport with the hiring team greatly reduces your chances of having an offer rescinded (in Sameer’s experience, from about 1% to .01%).
- Do not negotiate over email.
- You may think that it’s more effective because you will not make any mistakes when you’re speaking to them. But you have less control of the actual conversation. You want to build relationships with the hiring manager, and you can only do this through actually having a lot of conversations, not emails.