Mastering the Art of Salary Negotiation
by James Powell, Career Consultant, e-resume.net
With unemployment at a 29-year low and the economy showing few signs of slowing, the job market favors the professional job seeker when it comes to salary negotiation. Yet most of us are not comfortable negotiating our salaries even though negotiation has become a common part of today's business. It is important to feel confident in this part of the hiring process. The employer expects some type of negotiation, and we must be ready. With the tips below, even the most inexperienced negotiator can learn the art of negotiation.
Avoid the question of salary, until you have an offer. On job applications under salary requirements, put "open," "negotiable," or "competitive." If a salary requirement must be given, then give ranges (usually begin your range at 10% higher than your last salary and add $10K to get your range). If you are asked directly how much you would like to make, try to avoid providing a number, but answer in vague terms:
- "I'd rather discuss salary when we are both confident that I am a good match for the position."
- "I believe that my salary should be based on the specific responsibilities of the position and the standards of the industry."
- "What would a person with my background and qualifications typically earn in this position with your company?"
- "Although money is an important factor, I am most interested in this opportunity because I think it represents a good match between your needs and my qualifications."
- "From the job description and salary range that you had on CareerBuilder, we are in the same range."
Research your market value. Before you go into an interview, make sure you are armed with the most recent information on the salary ranges for the position that you want. Some good sources are:
- 1998-1999 Occupational Outlook Handbook
- National Association of College & Employers: Salary Survey
- American Almanac of Jobs and Salaries
- Professional associations or trade journals in your field
- Call directly into Human Resources and ask their salary ranges for the job you are seeking
- Compare specific salary ranges from CareerBuilder job listings
Do not take an offer on the spot. How valuable and in demand will you seem if you accept an offer the moment it's presented? Instead, either take home the written offer or take notes on the details of the offer. Tell the employer that you would like to go over everything very carefully, and set up a meeting for the next day. Now that you have some time to really think, you should examine the organization's entire compensation package. Be sure to consider these factors:
- Insurance: General coverage, medical insurance, dental insurance, eye care insurance, life insurance, accidental death insurance, business travel insurance, and disability insurance.
- Stock Options: How many shares, and at what price?
- 401(k) Plans: How much does the employer match, and when are you vested?
- Pension and Profit Sharing Plans: When are you vested; after how many years are you eligible?
- Tuition and Continuing Education Benefits: What percentage will be paid?
- Salary progression expected in the first 3-5 years.
- Vacation days, paid holiday, and sick/personal days: How many are you allotted, how are they earned, and what are the requirements for using them?
Negotiate. Once you have considered the things listed above and they are acceptable, you are ready to negotiate. Enter the negotiation armed with a firm understanding of your skills and what they are worth. Know your strengths in your field. For example, say you were a keen negotiator for large corporate contracts that brought $1 million in revenue to the company. Explain to potential employers how you generally brought x-times your annual salary package to the company in terms of corporate profitability within your first year.
- Negotiation is okay and is expected. If you are going into sales and do not even try to negotiate, this could be the last test of your interview. If you will not negotiate your salary, how can you be expected to negotiate multi-million dollar contracts for the company? Even if you are not applying for a sales position, employers may be wary of a deal that is made too quickly. For example, when buying a used car, if your first offer is accepted, don't you ask yourself: "What is wrong with it?" Do not allow yourself to be the beautiful candidate that the company now views with doubt because of your eager acceptance.
- Make sure the negotiation stays win-win. When a company offers you an exact figure, it is usually safe to expect that the number is its mid-range. This is not the time to play hardball; you will be working with these people if you accept the position. Use real-life examples rather that trumped up negotiation tactics that sound like "ME, ME, ME!" Think team.
- If you have an okay offer: "After looking over your offer fully, even though I'm sure it's very competitive, the actual salary figure is lower on a monthly basis by 10% than what I am currently making. Though the bonuses will help improve the situation, those are subject to change. Is there flexibility on the salary portion of the offer?"
- If you have a good offer: "We are certainly very close. I was hoping for something more in the range of $X to $Y. How much room do we have for negotiation on the salary?
- If you have a low offer: "I really like you, the job seems to be a good match, and the goals of management and the company's organizational strategy all seem good. The only area that we need to talk about –- and the only area holding me back -– is the initial compensation offer. Quite frankly, the salary is less than I expected. I am truly interested in the position and from my research, $X is the approximate level for the salary. The other companies I am speaking with are in that range. What can you do in this area?"
- Examine alternatives. If efforts are exhausted in the salary negotiation, and the company has not offered a salary acceptable to you, but you still want the job, shift the conversation to the future.
- Discuss a 60-, 90-, or 120-day performance review and negotiate a potential minimum percentage increase.
- Discuss a year-end bonus.
- Discuss the opportunity for a lump-sum signing bonus.
By being well prepared and confident, you will easily be able to master the art of salary negotiation, you will become more comfortable doing it, and you will negotiate an acceptable compensation package. Employers understand your point of view; they were once on the other side of this process. Remember to be knowledgeable about industry standards, firm in what is acceptable or unacceptable, and open to other forms of compensation. You'll end up not only with the position you want, but also with a salary you deserve.
James Powell, author of Mastering the Art of Salary Negotiation, is a Career Consultant with e-resume.net, a national resume writing service. e-resume.net combines personalized attention with the speed of the Internet to deliver professional resumes, cover letters and other documents essential to clients throughout their job search. For more information about e-resume.net, please visit their site on the World Wide Web at www.e-resume.net, or call (888) 277-5550. |
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