Want to love your job? Make sure you’re being paid fairly. While the relationship between actual pay and job satisfaction isn’t as strong as you might think, feeling like your pay is appropriate for your skills and abilities is key to feeling appreciated at work.
PayScale research shows that 75 percent workers who feel they’re paid at or above the market rate report high job satisfaction, compared to 59 percent of workers who feel that they’re paid below market. The problem is that most people have no idea how much they should be paid. That makes it difficult to negotiate salary when they take a new job or contemplate a promotion at their current employer.
And in most cases, it pays to negotiate, especially when taking a new job. Most hiring managers expect candidates to negotiate, once a job offer is on the table. Fail to do so, and you could cost yourself $1 million in lost earnings over the course of your career.
5 Steps to a Salary Negotiation That Pays
Of course, there’s a right way and a wrong way to go about negotiating salary. To get paid what you’re worth, make a plan that’s based on data, not secondhand information from your braggy coworker.
1. Research Salaries
Why shouldn’t you base your salary assessment on what you hear from others in your field? Well, for starters, there’s no guarantee that they’re being truthful. Buy their fish story, and you could wind up dissatisfied at work for no reason … or trying to negotiate a raise based on the wrong information.
Beyond that, you’ll never get the whole picture from a lunchroom conversation about pay. Your colleague might have skills or certifications that boost their salary, or experience in another area that levels up their compensation.
The best way to set your personal salary range is by using a salary calculator based on anonymous surveys from thousands of workers with your job title, skillset, education, and geographic location. There are several free salary calculators out there that can provide this information. Spend a few minutes entering your information and get a report with a range that’s based on data, not hearsay. (Best of all, getting the facts about your pay means that you’ll have a way to counter any attempts to base your compensation on salary history.)
2. Choose the Right Time
When it comes to negotiating salary, patience is a virtue. Don’t bring up compensation until the employer makes an offer, and try to avoid getting locked into a range early on in the process.
Let the employer make the first move. If you are asked what your salary requirements are, say that they are flexible, based upon the position and the total compensation package including benefits.
An alternative is to tell the employer you'd like to know more about the job responsibilities prior to discussing salary. You can also give the employer a salary range based upon salary research you've just completed and cite the research you have done.
Keep in mind that there may not be much flexibility. If the employer has a budget or an established salary structure, the best you might get is the top of the range for that particular position.
3. Have a Backup Plan
Don't limit yourself to salary alone. If the employer can't afford to pay more, ask about the possibility of salary reviews sooner rather than later, extra vacation, or even a bonus based on performance.
Regardless of where you are in the negotiating process, remember to remain positive and continue to reiterate your interest in the position. Let the employer know that the only issue is the salary and you are really excited about the job and the company.
Then, if the position does sound like the perfect job, consider whether the company culture, including the benefits and flexibility, as well as the job itself are worth it – regardless of the salary. If they are, it might just be worth accepting the position and taking a chance that the salary increases will follow!
4. Leave Emotion Out of It
Never let an employer know you need money. It won’t help, and it might make you look desperate – and unprofessional. Instead, let your data do the talking. Salary negotiations are about what the market will bear. Your personal life shouldn’t come into it.
However, always be honest during the job interview process. If you’re forced to divulge your salary history, don’t fudge the numbers. Be truthful about job titles, experience, and other job offers that are on the table. Lies have a strange way of coming back to haunt the person who didn't tell the truth.
5. Don’t Feel Pressured to Accept Right Away
Once you've received the offer, plan on taking some time to think about it. There is no need to accept or reject it right away. A simple "I need to think it over" may get you an increase in the original offer. One candidate, who had decided that they really didn't want the job after all, said "no" three times only to get three higher offers!
Be aware that this could also have the opposite effect – the hiring manager could decide that you are asking more than he is willing to pay and accept the "no" response as final. So, it’s important to know your bottom line for each position. If the salary isn't enough for you to live on, be prepared to pass on the job.