How to Set a Salary Range for a Job
How to Determine How Much You Should Earn at Your Next Job
How much should you expect to earn at your next job? In other words, what is your salary range? You know what you are or were being paid in your latest job, but do you know what the larger market would pay for your skill set? Are you on the high end or the low end, and is that where you should be?
When looking for a new job, knowing your salary range - not just your target salary but a bottom line as well as a reasonable potential upside - gives you a sense of perspective and provides direction to job search. Jobs that fall outside of range are easier to rule it out.
Having a range in mind also puts you in a position of power when preparing for job interviews. If you are confident about your range going in, you are more likely to appear like a thoughtful candidate and even a shrewd negotiator.
Is Your Current Salary and Title in Line With the Job?
So how do you set your range? Start by knowing what your current job is worth. Gather as much information as you can on salaries in your field, including your most recent job and salary. Salaries may have shifted since you began working at the company, particularly if you have been at your job for many years. What would your company have to pay someone today to do the job?
Look at job listings within your existing company and for the larger industry. To see if any companies are disclosing salaries paid for your job as well as the job you want. If you have a sense that your most recent title is not in line with your job responsibilities, research titles that you believe better describe your role. This will provide you with more accurate estimates for your target salary.
Researching Salary Ranges in Your Industry
Websites that offer salary data and salary calculators, such as Salary.com, Payscale.com, Indeed.com, and Glassdoor.com, can provide you with some benchmarks for job titles and salaries within specific companies. (Glassdoor also includes company reviews, which may sway your opinion further.) Even the Bureau of Labor Statistics offers wage estimates for each sector in the US.
The information on different salary sites may vary, and it is not always completely accurate, but if you survey more than one of them, you can get a sense of an overall range. Remember to research the title that best encompasses your job responsibilities. Be sure to pay attention to regional data, and only look at averages in your area. Some sites will also let you include specifics like years of experience, degrees earned, and so on.
Ask Salary Experts
If the numbers you find in your research seem wildly inaccurate compared to your recent salary, a recruiter can also offer advice on how to approach the salary range question. Independent recruiters (those who do not work inside the larger corporation) are fairly impartial and want you to get what you are worth. If you are working with one, you should be able to get more specific feedback based on your skills as well as conditions in the larger market and what companies want to pay.
You may also be able to get similar feedback through a professional organization within your industry. Industry blogs and trade publications can also be useful sources of information. You may be able to get feedback to your question on a user forum but keep in mind that the information source may not be trustworthy.
If you have friends and former colleagues who work in the same industry, turn to them for feedback. Even if it’s a simple “Does this sound right to you?” a knowledgeable friend can help add to your data.
With research in hand, it should be easier for you to determine your target salary. The top end and bottom end of this range will likely be within $10,000 or $15,000 of one another, with the target somewhere in between.
Consider Your Budget and Base Salary Needs
For many people, the low end of the salary range may be your most recent salary plus around 10%. Why bother changing jobs otherwise? But if you are out of a job and need to adjust your expectations, or are considering a move to a new career, you may need to consider more than what is acceptable in your industry. It’s also important to know what you can live with.
If you have not done so, it helps to create a personal budget tracking all outgoing monthly fixed and variable expenses. What would your salary requirement be if you cut some of the variable costs? If offered your dream job, would this salary work for you? Remember, your employer may choose the lowest number within your range, so make sure it’s is reasonable for you.
Remember the Benefits
Your salary considerations should include cash bonuses, stock bonuses, and stock price, as well as other types of employer-sponsored benefits and perks like 401k matching, profit sharing, healthcare, and flexible work offerings. If the company is a startup or new venture, consider future growth and compensation potential. Even a perk like shortened summer Fridays or a workday schedule that favors work-life balance may factor into your range.
So do your research and know your new position will have you feeling at home on the range.