One of the most frequent requests that I receive from individuals seeking my advice is how to negotiate their salary. The question often comes up during a job search, and later, when individuals want to renegotiate their salary. What you are paid is largely determined by the quality of the information you have regarding your worth to a company, and by your willingness to ask for what you are worth. Being able to demonstrate and document your value is exceedingly important.
In salary negotiations, Rule Number One: never try to negotiate a salary until you have received an offer of employment. Job applicants are often asked to provide a salary expectation or a salary history. I always advise job seekers not to respond to a verbal inquiry or on an application form. Instead, I recommend that you simply say that your salary demands are negotiable. When pressed I suggest that you indicate that salary is not your primary concern at this point and explain that you are focusing on the learning experience you will have and the challenges you will face. Indicate that you expect that you and they will reach a reasonable salary agreement after you have had a full understanding of the opportunity the company offers and after they have a complete sense of the skills and experience you bring to the table.
Why wait? Why not just blurt out what you want at the offset? If you quote a salary that is too high, you will bid yourself out of the market. If you quote a salary that is too low, the prospective employer will believe that you do not understand the nature of the position, or that you are not really worth much, or that you are too anxious or too inexperienced for them to bother with. Why should they place a premium value on your expertise if you don't? You are in a much more powerful position when you have an offer in hand - after the employer knows exactly what you bring to the table, and after you know exactly what interesting challenges the job opportunity offers and what it entails.
The personnel folks may push for an answer about what you expect in your first interview, so you will probably need to be creative in fending them off. How should you approach the situation so as to not put the employer off? Tell them that you are flexible and that you really prefer to negotiate your salary after you have a complete understanding of the position. Say something like "At this point I am really more concerned about the learning experience I will have and the type of work I will do. I think we can come to a reasonable agreement about salary after I understand all that this position offers and you have a sense of the talent that I bring with me."
Rule Number Two: do your homework! There are three basic pieces of information that you need to develop before you respond to any questions about salary expectations.
First, you need information on competitive salaries for people already in the labor market who have skills, experience, and training similar to yours. (Salaries differ greatly from city to city, state to state, and country to country. This has to do with the cost of living and the supply and demand for different professionals and specific skills sets).
Second, you need to develop a list of your assets and abilities. This helps you and the employer understand why you are worth what you are asking for. (You should chronicle your accomplishments on paper throughout your career so you will know and be able to share pertinent data when it is time to renegotiate and on what basis.)
Third, you need to do a cost of living survey for the cities where you might be living. I frequently work with candidates who have no idea about the worth of their salary offers in different cities nor the cost of living in various cities. This is really important. Way too often individuals find that they have accepted an offer to move to a higher salaried position only to find that they will be living in a much higher cost living area. They are shocked to discover that they cannot afford the move.
Rule Number Three: have a negotiating strategy. Your decision to negotiate for a higher salary should only be made after you have received an offer and after you have done your research. If you feel your offer is not high enough now is the time to negotiate. Do not accept the job first and then try to get more money. Negotiate before you accept the offer. Timing and information are everything.
From your research, you should know what you are worth, what the market will bear, and the relative strength of your bargaining position.
When an unacceptable offer is made, your response is to ask: "Is that salary negotiable?" Your question is actually a statement ("I want more money"), but don't worry about this minor bit of miscommunication; the people on the other side of the table (or phone) will understand the question as a polite and proper opening move. Unless they tell you that the offer is the best they can do, they are undoubtedly going to counter with: "What did you have in mind?" When you hear that, the negotiations have been opened. You will be expected not only to give a figure of worth that you have arrived at, but you will also have to back it up with facts.
You will have to tell them what you want and why you deserve it. In essence, you have to explain the basis for your request and justify your demand. This is where your research pays off. In addition to the information you have gathered about what you are worth to them you will be expected to identify the element that make you an exceptional candidate.
During your job search you should be applying for multiple positions so that you have some options and hopefully receive multiple offers. This puts you in a much more powerful negotiating position. The easiest way to make your case for more money is by comparing their offer to other higher offers you have received.
When you present your opening salary request, it is usually best to go a little bit high so that you will have room for compromise. Go high, but be sure to keep it reasonable. And remember that you are not just talking about money. You have to evaluate the whole package, including benefits, opportunities, future potential, training, location, and so on. Be sure to have a folder with the salary information and a list of your assets to share with your employer.
Compromise is the key to good negotiations. You are looking for a challenging career with a competitive compensation package. Their interests are the same as yours: they want to pay you what you are worth so that they gain a committed employee. They want someone who is satisfied and who won't waste time and attention thinking about finding a better opportunity or leave when the market improves after they have trained you. To reach this common goal, there has to be flexibility on both sides of the table. Most companies are fairly motivated to negotiate especially if you are in a high demand field. This holds true for experienced as well as inexperienced candidates. The supply of talent worldwide is shrinking.
