Unlock Your Earning Potential: Salary Negotiation Made Simple
Conversations about salary expectations often take place in the early stages of the hiring process, but salary negotiation happens when an employer presents you with an offer for a new role. Salary negotiation is when a candidate discusses compensation with a hiring manager or HR representative in order to increase it.
Knowing how to negotiate a salary offer can help you earn more money over the course of your career. Here are five tips to help you with your next salary negotiation:
- Choose Your Initial Counteroffer Carefully
- Avoid Being Apologetic
- Negotiate More Than Your Salary
- Think of Negotiation as Collaboration
- Don’t Overpromise or Lie
Why Should You Negotiate Your Salary?
Failing to negotiate means leaving money on the table. CNBC reported that U.S. employees could earn 13.3% more if they negotiated their salary.
Negotiating can compound your earnings throughout your career.
Even without the annual increase, the difference in base salary alone adds up to $25,000 over five years.
People who don’t negotiate will have to work several years longer to save the same amount for retirement as their colleagues who do negotiate. The monetary benefits of negotiation can’t be understated.
Other benefits of negotiating a higher salary
Applicants who engage in collaborative problem-solving to negotiate salary were more satisfied with their job offers and their jobs (Harvard Law School’s Program on Negotiation).
In 2021, 63% of employees said they left their jobs because of low pay (Pew Research Center). Start strong, stay longer.
Negotiation can be a great way to build confidence. Going through the process of listing the reasons you deserve a higher salary and elaborating on your value is empowering.
The Top Reasons Why You Can (And Should) Ask For More
When you ask for more money in the job offer stage, it’s best practice to provide an explanation to support your request. Wanting to improve your quality of life or keep up with rent increases are valid reasons to seek a higher salary, but you should refrain from mentioning them in a salary negotiation. Instead, provide specific reasons that show the value you could bring to the role and justify why you deserve a higher salary.
Evaluating why you deserve a raise and showing up to the salary negotiation prepared will make it easier to stand your ground confidently.
Here are a few reasons you might want to negotiate your salary:
In-demand skills or jobs. Depending on what’s going on in the world, your skills or job may be especially in demand giving you additional leverage. For example, the demand for nursing roles rose significantly when the COVID-19 pandemic was in full force.
Advanced or unique skill set. Some hard skills are very niche or take time to master because they are highly technical. Additionally, your skills may be more up-to-date (whereas the rest of the employees need to upskill). Either of these reasons may allow you to secure a higher salary.
Specific licenses, certifications, or credentials. Employers often have a list of preferred criteria, but it’s almost impossible to find a candidate who meets ALL the criteria (this is called a purple squirrel). Because of this, employers will often be inclined to pay for additional training, licenses, or credentials if necessary. This puts you in a good position to request additional compensation.
Experience or education level. Having more years of experience or education than the job description asks for can allow you to justify asking for higher pay.
Location. The cost of living differs drastically depending on where you live, and it may be valid to make this point. For remote jobs, remember that organizations may base salary on national averages, where the headquarters is, or where the applicant is.
Additional skills you could bring to the role. If you have skills that were not listed as preferred in the job description, but they help you do your job better, you can bring them up in the negotiation. Bilingual candidates, for instance, bring additional value to the role by being able to work in two languages, so they’re more likely to be able to secure additional compensation.
Understanding the current job market in your industry and having a list of reasons you deserve a higher salary allows you to be more informed and prepared going into a salary negotiation.
Why You Might Hesitate To Negotiate Your Salary
Mint surveyed 1,000 millennials, and 58% said they’ve never negotiated their salary. There were three main reasons for this:
- They were happy with the salary offer
- They didn’t know how to negotiate salary
- They were scared of the consequences of negotiation
The third item in this list represents a fear that negotiation significantly increases your risk of losing a job offer. The results of Salary.com’s survey of more than 1,000 companies show you have nothing to fear: Employers are very used to negotiating, and it doesn’t make them less interested in hiring you.
Nearly 90% of employers say they have never rescinded a job offer because of negotiations.
73% of employers agreed they are not offended when people negotiate.
84% of employers said they always expect job applicants to negotiate.
If you stay professional throughout the process, the data shows losing a job offer due to salary negotiation is unlikely. Don’t let fear or uncertainty hold you back from negotiating. You won't get a higher salary if you don’t start the conversation.
When Should You Negotiate?
Salary negotiation is totally optional but incredibly beneficial. There’s a lot to be gained in knowing when and how to bring up salary and when to give up on salary negotiation.
Even when a company lists a salary in the job description and states that it’s non-negotiable, that doesn’t mean you can’t negotiate other elements of your job offer.
Most job postings still don’t include the salary in the job description, but there is increasing public pressure around salary transparency. According to SHRM, 45% of employers now include a salary range in job postings. Whether there’s no salary listed or it’s expressed as a range, it creates a grey area and leaves room for salary negotiation. Just because the job ad doesn’t explicitly state that the salary is flexible or negotiable, it doesn’t mean you can’t negotiate.
Discussing Salary Before The First Interview
It’s not uncommon to discuss salary expectations in the screening interview, which comes before the first interview with the hiring manager.
If the recruiter doesn’t bring up salary, and there’s no range in the job description, it’s fair to ask if they have a salary range in mind for the role. Without launching into a full-blown negotiation, if the range is lower than the range you had in mind, here’s what you could say:
“Thank you so much for sharing the salary range with me. Based on [insert a few reasons from the list above here] and my market research, this is lower than I expected. Is there any flexibility in this range or is there an opportunity to discuss the overall compensation package?”
Be professional, but don’t be shy about having expectations. It can save everyone a lot of time because you may realize you need to withdraw from the interview process immediately.
Discussing Salary In the Offer Stage
Typically, during the offer stage is when you have the most leverage to discuss salary. Once you’ve assessed the offer and expressed your excitement and gratitude, you can share the number you’re looking for, and a few reasons why you feel you deserve it. Ideally, you’d negotiate over the phone or in a final video interview, but negotiation can happen over email too.
Here’s a little sample salary negotiation template you could use no matter where the discussion is happening:
“Thank you so much for this opportunity to join [insert company name here] as a [insert title here]! I was hoping we could discuss the salary as it currently doesn’t meet my expectations. My [reason #1 why you expect a higher salary], [reason #2], and [reason #3] will allow me to [describe the unique value you would bring to the position]. For these reasons, I feel [insert single number here] is a more accurate reflection of my value.”
If you aren’t satisfied with the results of your salary negotiation after a fair amount of back and forth, be willing to walk away if an employer can’t meet you at your minimum.
Now that you know when you have opportunities to negotiate, it’s important to cover the situations when it might be best to avoid negotiating.
Do you have to disclose what you currently make or want to make?
No, you are under no obligation to disclose your current or exact expected salary, especially if they haven’t disclosed the salary range. If employers ask this question, it can be a big red flag.
Additionally, asking about salary history is illegal in 22 states and 22 cities in the U.S. (HR Dive). Know your rights and find out if it’s illegal where you live.
When to Approach Salary Negotiations Thoughtfully
There are three situations where you may benefit from ending the negotiations early, or not negotiating at all.
- The salary is non-negotiable. It’s not about your value; it’s just that the organization cannot offer more than what’s allocated. Salary bands are often more rigid in government roles, for example.
- The range is way below what you were expecting. The bigger the ask is, the greater the risk of having the employer pull away. Even if you are a great candidate and the hiring manager likes you, sometimes the employer just doesn’t have the budget.
- You’re happy with the salary offer. Some employers will provide a very compelling offer right out of the gate, especially if you talk to them early on about your salary expectations then you impress them in the interview process.
Use your discretion and be respectful of any clear boundaries the employer has communicated. You can still try to negotiate in all the situations above, but you also need to be prepared to walk away. The goal is to leave things on a good note with an employer, even if you don’t end up working for them.
How To Negotiate a Salary Offer: Top 5 Tips
Salary negotiation is much more complex than simply requesting more money.
Here are five tips for negotiating a salary offer:
1. Choose Your Initial Counteroffer Carefully
Anchoring bias is the tendency to overvalue or give more weight to the first piece of information about a topic (The Decision Lab). Your counter will become the anchor that the rest of the salary negotiation is based on, so make sure it’s a little higher than the salary you’d be happy with. Employers are more likely to go low than high.
Research shows that a bolstering range can help you get your way in a negotiation thanks to anchoring bias (Harvard Law School’s Program on Negotiation). In a bolstering range, the bottom is the salary you’d be happy with, and the top is a more ambitious number. In practice, this looks like asking for $65,000 to $70,000 instead of simply asking for $65,000.
2. Avoid Being Apologetic
It’s totally normal to feel like your interview nerves have extended into the negotiation process, but there’s no need to say sorry for asking for more money! Asserting yourself can be uncomfortable, especially if you’re not naturally assertive, but it’s very important to avoid apologizing or sounding hesitant. You want to radiate confidence, instead of showing that you feel awkward or guilty asking for more.
3. Negotiate More Than Your Salary
There are specific situations where the employer can’t or won’t give you the salary you ask for, but you can still ask if there’s room to negotiate other aspects of your overall compensation.
Alternatively, you can bundle your salary negotiation together with other asks off the hop so you can deal with everything at the same time, which is more efficient for everyone involved.
There are other benefits employers can provide to improve your quality of life or reduce certain costs.
This can include:
- Pushing out the start date
- Offering remote or hybrid work arrangements
- Flexible scheduling
- Expanding health and fitness benefits
- Increasing commission percentage
- Providing a signing bonus
- Paying for professional development
- Offering child care
- Changing the job title
- Paying for a phone allowance
- Covering moving expenses
- Matching retirement contributions
- Providing commuter benefits
- Ensuring a severance package
- Adding vacation or sick days
- Including access to a coworking or office space
- Providing stock options
4. Think of Negotiation as Collaboration
Showing your gratitude every step of the way and taking a collaborative approach to negotiation can go a long way. Think of it like you’re trying to work with the recruiter to solve a mutual problem.
While it may be true, saying “I can’t/won’t accept less than [insert salary here]” is a quick way to make the person on the other side feel like the process is competitive, not collaborative (Forbes).
You don’t have to issue an ultimatum. The goal is to be firm and confident without being threatening.
5. Don’t Overpromise or Lie
Explain the reasons you deserve a raise without overselling yourself. Insecurity can take over, and it can feel right to make big promises to prove your worth. Overpromising in negotiation can backfire and create false expectations that you’ll be held to down the line.
You don’t need to fabricate an alternate offer to create a false sense of competition to get what you want. The right job opportunity is out there, and the right employer will see your value and pay you fairly.
Frequently Asked Questions
Should You Accept the First Salary Offer?
If you’re happy with the offer and it seems competitive, you can and should accept the first salary offer. However, there’s no need to accept the first offer you receive. Employers expect candidates to negotiate.
Research by CareerBuilder found that 73% of U.S. employers are willing to negotiate salary on an initial job offer. Sadly, over half (55%) of candidates accept the first offer they receive without negotiating.
How Much Is Ok to Negotiate Salary?
If the job offer is average, asking for 5-7% is fair. Consider that if you’re an entry-level candidate you may be on the lower end of the average pay scale.
Keep in mind that it’s not uncommon for employers to try to save some money and throw you a lowball offer since statistically, most people don’t negotiate. If you know you’re an exceptional candidate for a specific role or company, why not aim high? Glassdoor suggests asking for between 10% and 20% above the initial offer.
Should You Disclose if You Have Multiple Job Offers?
You might think sharing that you have multiple offers makes you an attractive candidate, but it can either help you or hurt you, depending on who you’re dealing with.
If the employer asks, and you have another offer you’re considering, you should tell them. Refrain from telling the employer you’re negotiating with if you’re simply interviewing with another company.
If they don’t ask, disclosing that you have options may make the person you are negotiating with disengage. Ultimately, they are looking for a candidate who is invested in getting the job to fill the vacancy, so don’t rush to share if you have multiple organizations trying to hire you.
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