Whether you are accepting a new job or seeking a pay raise, the thought of negotiating a salary offer can be intimidating and stressful.
In a Mint survey in 2020, it was reported that 58% of millennials have never negotiated their salary for various reasons. The same survey showed that most salary negotiations prove successful. What does this mean? It means that the 58% of millennials who settled for the initial pay they were offered could have increased that number by 5%, simply by negotiating. If you’re unhappy about what you’re currently earning, it may be time to negotiate your salary.
How to Negotiate Your Salary
With these 5 salary negotiation tips and a bit of practice, you’ll be more than confident to ask for that bump in your salary.
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1. Determine the Average Salary Range
The first step to negotiating your salary is to know the salary you’re aiming for. To set a reasonable salary goal, you need to do your research and determine the average salary range for your role. This number should reflect the level of education attained (Bachelors, Masters, and any relevant certifications) as well as the years of experience under one’s belt.
Context also matters. Salaries will vary based on location (ie. Asia Pacific and America) and company size, so get the numbers for where you are and how big your company is.
Look into the average salary on online databases such as Glassdoor (worldwide), Indeed (worldwide) and JobStreet (within Asia only). You can also check your average entry pay in this 2020-21 College Salary Report by PayScale (within the US only).
2. Prove Your Value
Once you’ve determined your salary range, you should provide the employer or hiring manager evidence about your past work experiences. In the last year, did you exceed your targets or lead a successful project? What positive feedback was given to you during a recent performance review? Exhibit your most impressive work and show how you have added value to the company.
Compile your evidence into a report that clearly shows your progress and contributions. It should have tangible numbers and/or feedback from your clients or managers. When negotiating a higher salary, highlight the reasons you deserve it. It helps a lot to practise what you will say confidently and professionally. Rehearse this with a friend or colleague to prepare for the big day.
3. Number Play: Stating Your Salary Expectations
This next salary negotiation tip is a practical strategy that people use when bargaining a number. So, imagine you are in a meeting with the hiring manager, and you state your interest in getting a salary bump. Then you show them your past work (see Point #2). Eventually, your employer or hiring manager will ask you, “What are your salary expectations?” With that said, do not bring up your salary expectations until it has been asked.
Always give a range from X amount to Y amount. X amount should be the actual number you’re aiming for, and Y amount should be a number slightly higher than that. You could say, “Based on my research, someone with the same role and experience earns between $55,000 to $65,000 a year.” Be sure to start with your goal salary and nothing lower, because the employer will tend to settle for the lower limit you stated.
4. Prepare for tough questions
Now, what if the employer says they can’t meet your minimum salary expectation? Should you turn down the job? If you’d really love to be a part of the company, then you will need to prepare your response by looking at potential alternatives. If you are being offered an amount less than your desired salary, think about what you will really need in return for your work.
When you negotiate your salary, remember that you still have your salary package to fall back on. Swap the salary bump for more vacation days, better health coverage or equity. Perhaps, you can even ask about more senior roles in the company that you can fill. If you’re already in the company, then find out what targets you’ll need to reach to advance your career towards a senior role.
5. Time It Properly
Timing is a key factor to a successful negotiation that people tend to overlook. It’s not about the duration of the meeting or the time of day. Rather, you should pick the time of the year that will work most in your favour.
So, when is the best time to negotiate your salary? When the quarterly or annual performance review rolls around is usually a good time to bring up the topic of a pay raise. If your company has just scored a large deal and you were a part of it, you can also leverage on this timing.
It’s also helpful to consider your company’s financial situation. A salary negotiation will probably be unproductive if you discuss it after the company has gone through a budget cut or if they’ve just taken a massive hit from the economy.
Final Thoughts
Even though people are usually apprehensive about negotiation (especially early in their career), it is a valuable soft skill to have. Before going into any negotiation, remember that the goal is to come up with a win-win situation for both parties.
One last note: if the negotiation turns out in your favour, send a thank you email to the employer/hiring manager, confirming your new salary and its effective date. So, follow these tips, remember to practise, and be confident! Good luck!
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