Most people look to the Bureau of Labor Statistics and its monthly employment report to understand the job market. While that is probably the best measure, there are other important signs, including how employers are treating employees and job candidates. A few months ago, I noted that almost every job posting now includes a list of benefits offered to new employees. Some are even listing a salary.
Employee retention is equally important. Bloomberg reports that some employers are now encouraging employees to use PTO and vacation time. A few employers are even paying bonus that employees can use during a vacation. Others offer “unlimited vacation.” These are the same companies who laid off so many workers that those who were spared worked extra hours and skipped vacation days. Now, as the job market tightens and employers still do not want to raise wages, vacation is a perk used to keep employees without increasing labor budgets.
If you’re asking for a raise or trying to negotiate salary with a new employer, think about vacation as a bargaining chip. If an employer cannot give you a higher wage, ask for an extra week of vacation or PTO. This is a good time to talk about time off.
Negotiating with a prospective employer is never easy. Most people don't even attempt to negotiate because they are afraid an offer will be pulled. However, when job seekers chose to negotiate, they often get more than the initial offer. This is especially true when they are willing to walk away from an offer.
A few months ago one of my clients received a job offer, but needed to have relocation costs paid. We worked together to come up with a goal of $6,000. At the last minute, my client changed her mind, and she told the employer that she would need $8,000 to relocate. The manager handling her recruiting said they could not meet that request. My client said she could not accept the offer. She thought it was time to move on. The next day, the company called back with a revised offer that included $6,000 in relocation fees and an ability to work remotely for one month, which let my client avoid paying two rents. If my client had not stuck to her guns, she got most of what she wanted. On the other hand, she did risk losing the job.
More recently, a client who is a manager with a small non-profit received a low ball offer from a large national corporation. She told the recruiter that the offer would have to be significantly increased. The next day the recruiter called with a $10,000 increase. My client compared her current position to what the new employer would ask of her. She also underscored the value she would bring to the employer. She did not ask for a specific amount, but told the recruiter that the offer would need to be improved. Two days went by. My client thought she had pushed things too far. She was wrong. The next day the manager called and increased the offer by another $10,000. She gambled and won.
I'm not recommending that every job seeker should take such drastic steps when negotiating. However, if you feel that an offer is not fair, you might want to consider taking a chance in your negotiation. There are no guarantees. Some companies will decide not to hire you. Others will recognize your value and give you what you're asking. Walking away is a big gamble that, in some cases, can have a bigger payoff.
Jenny Che of The Huffington Post has written an article exploring how new college graduates can earn more on their first job. Che’s advice can be summed up in one word: Negotiate. According to an expert cited by Che, many companies are willing to increase salaries for new college graduates by as much as 5-10% over the initial offer. If the employer won’t offer more money, it’s possible to negotiate some other aspect of compensation: employer share of health care, education reimbursement, or related benefits. What’s the secret to getting more on your first job? Know you worth, and ask the employer to give a little more.
Here’s another sign of a changing – improving – job market: The experts are talking about how negotiate a starting salary or a raise. Much of the advice is good. However, I think any kind of negotiation with an employer can be broken down to two basic questions:
- What do you want?
- Why should your employer give it to you?
Too often we as employees are resentful of co-workers who work less and make more money. Or we tell ourselves that we are working that we deserve better pay because we are working so hard. These points may be true, but they won’t help you get a raise or better starting salary. Focus on two people: the person who can give you a raise and yourself.
First, know what you want. Here it is important to know how other employees are paid and how similar companies pay people in similar positions. If you don’t have this information, you can do research using online salary websites. The problems with these sites is that they make broad estimates. Salaries vary from region to region and company to company.
Establish a clear goal for negotiation and a salary range. If your currently making $50,000 and want a $3,000 raise, give yourself and your boss room to work. I’d recommend asking for a raise between $2,500 and $4,000. This range will let you negotiate up or you might get what you want with any kind of dickering. If you ask for $3,000, expect your employer to offer less.
While you think about what you want, you also need to put yourself in the employer’s place: Why do you deserve a raise? Think about what you have done over the last year. How have you contributed to the company? How have you made a difference? Make a list of your achievements, quantifying them if possible. Know you worth and be ready to help you employer understand why you deserve better pay. Keep your tone professional at all times. Focus on what you are doing for the company and what you expect in return.
Some employers are still very hesitant to give raises. They might offer a much lower number than you want or say they can give no raise at all. Just a few years ago, your options would have been limited. Now, the good news is that the job market has changed and hiring is up. If your current employer won’t give you the salary you want, it’s time to look for a new job with better pay or better working conditions. Know your value and find an employer who is smart enough to pay a fair wage and value your skill.
One of my clients just called with good news. He received a job offer two days ago and another one today. Better still, he interviewed for a third time with a potential employer who will probably make him an offer tomorrow. What should he do?
Take the time to make the best deal. He’s already gotten both of the companies that have made offers to wait until Friday to let him make a decision. He’s asked the company making a lower offer to raise it. And he’s informed the company that has not made an offer that he has two other potential employers waiting for him to make a decision.
This is the ideal situation, and it doesn’t happen often. Be sure that you are communicating clearly and honestly with your prospective employers. If you’re going to use multiple offers to ask for more money, know that there is a risk that an employer will retract its offer. However, if that employer really wants you, they will pay more or find some other way to compensate you.
When you’re in a position like this, be calm and strategic. Make the deal that works best for you.
I’m coaching a client whose been offered a job as a tutor. The employer offered $15 per hour, but said he is open to negotiation. My client is currently making $20 an hour at a part time job, and she works an extra job she will have to give up to take the tutoring position. She wants the job as a tutor, but wants to make at least $18 an hour.
We practiced role playing for a negotiation session. My client, speaking in a muffled voice, said she really needed $18. Playing the employer, I responded that the best I could was $16, and my client meekly replied, “O.K.” That’s not a good negotiation style or strategy.
The first thing we worked on was sounding calm and confident at all time. Even if a negotiation doesn’t go the way you want, it is important to sound like you are in control, the equal of the person you are negotiating with. Practice your negotiation pitch, and listen to yourself. Keep practicing until you sound calm and natural.
The second step is to develop a strategy to obtain the wage you are seeking. When my client started by asking for the wage she wanted, she was setting herself up to get less. What should you do? If you want $50,000, ask for $53,000 or $55,000. These amounts will give you room to negotiate down. I practiced with my client so she would ask for $20 per hour with a goal of going no lower than $18. If she’s lucky, the employer will pay the higher amount.
The third step is to develop reasons why you are worth what you are asking for. The employer really doesn’t care about what you need. They need to know why you are worth what you are asking for or why you have something now that will let you walk away from the offer. My client currently makes a little more per hour (at a part time job). She also has training in an area that few other tutors have, which is another reason she should be paid more. Before you negotiate, have some reasons why you are worth what you’re asking for.
Finally, know your limits and risks. If you negotiate in a way that is disrespectful or out of line with standards for salary, an employer could pull an offer. Do homework on salary rates before negotiating. Be respectful, but focused on your goals. If you negotiate in a strategic and professional manner, the employer will respect you and accept some or all of your terms.
Last Sunday’s USA Weekend featured an article on negotiation by Jeff Wurorio that was entitled “Let’s Make a Deal.” Wuorio makes a simple point: Anything can be negotiated. He gives examples of a man asking for a raise, a woman trying to get her teenagers to work around the house, a couple deciding what to do on the weekend, a woman trying to get a hotel to waive fees, and a family deciding where to spend its vacation. All of these situations involve decisions about which people can disagree – and compromise.
The obvious question behind any negotiation is: How do I get what I want? Wuorio makes a good point that applies in all of these situations: “Keep the conversation positive and focused, and great things can happen.” I agree about tone. It does no good to be confrontational or bullying. Know what you want, but it’s equally important to know what the other party wants and what you have to give.
Rather than asking what you want, let your first step in negotiation be to ask: What am I willing to give up? What does the other party want? Once you answer those questions, you will know what leverage you have to negotiate. The more the other party wants what you have, the more power you have to negotiate. Conversely, the less they want what you have, the less they will be willing to deal. If you don’t have something they want, you are not negotiating. You are begging.
Take the time to ask the right questions, and your ability to negotiate will be much stronger.
When many people hear networking, they only think about finding a new job. In reality, networking is a great way to manage your career and help others manage theirs. One way that network contacts can be resources that enable us learn more about salaries and benefits offered by potential employers.
My clients in nursing often are the best informed about what employers offer. They work together at different hospitals, and they share information, which enables nurses to make better decisions about where to look for work. They also tell each other which employers treat their workers well and badly.
How can you obtain similar information? Get involved in industry associations and groups. Meet people at networking events and talk to them about their careers as much as you talk about your own. As people in networks become comfortable and trust each other, they start to share very important information. Get to know people who can help you get the information you need to make good career choices.
Workers often end up in situations where they feel forced to make an instant decision: a job offer, salary negotiation, performance reviews, or signing a disciplinary document. One of my clients is involved in a negotiation that might not go his way. I gave him this advice: If you feel yourself getting angry or tongue-tied, ask for 24 hours to think about the situation. Taking a day will let you make a clear decision and express yourself more clearly.
Some employers will demand instant action. In those cases, do not assume good will. Ask what the consequence will be if you do not make an immediate decision. Or ask why the employer will not give you a day to think about your decision. Asking such questions will at least give you a few minutes to think about your action. They might even change the employer’s mind.
If you are forced to act immediately, know that you have the right not to accept what the employer is offering. It might cost you a job, but, in the long run, that could be a good thing. Bully employers will keep asking for more and more. Don’t give in to such people.
A client called today to tell me that he was going to ask his boss to change his title. I was confused because this client has told me in the past that co-workers who are doing the same job make more than double his salary. Why does he only want a change in title?
My client explained that one of his co-workers is moving to another company and wants him to follow. If he moves under his current title, it’s likely that the new employer will also try to low ball him on salary. So he is asking his current boss to give him something that will not cost a dime, a better title, which he will use to bring up his value with a new employer.
People who live by fear would say my client should be happy to have a job. He should play by the owner’s rules. I’m happy to say that he’s playing his own game – he’s playing chess.
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