Factors To Consider While Negotiating Your Salary
Workers often get underpaid either because they were desperate to take the job offer or ignored some basic factors while negotiating their pay. Negotiating better pay should be the focus of every employee. The value of your input in the workplace should be commensurate with the salary, if it doesn’t; it means your labor is partly being exploited. It is paramount to approach the issue objectively, with an evidence-based case, so as to end up with the salary you deserve.
Salary negotiation entails interfacing with an employer to settle on a salary and benefits package that meets your expectations, given the prevailing market situation. It doesn’t matter if you are an old employee or a new hire, once you feel the pay offer is below your academic qualification, career level, skill set, and workload, you should request a salary negotiation. You can equally suggest other forms of compensation, such as equity or stock options and additional incentives in form of health insurance, housing package, extra vacation days, and so on. It is important to note that salary negotiations should be done after an offer has been made by an employer.
Why should we negotiate salaries?
At first, the idea of salary negotiation can be discomforting especially if you have just been recruited. However, not discussing your salary and other employment benefits can affect your lifelong income potential. For instance, if you’re taking 20% less than you should in a country with an annual salary increase average of 5%, it will take well over three years to cover up for the avoidable loss. It may surprise you that if it is about salaries, most employers expect candidates to negotiate. And once done properly, it will set your life income potential on an ascending trajectory.
Below is a wide range of factors to consider while negotiating your salary:
- The prevailing market average salary: Understanding your industry’s labor market will guarantee a more successful negotiation. Research about the market’s average income in your country, within the firm, and even in other firms, will give you a good background for negotiation. Having the required information will ensure that your request is neither too high nor too low and will show your employer that your proposal is coming from an informed point of view. You can equally seek information on how to go about negotiating to minimize the chances of making mistakes.
- Your worth: Knowing the value of your expertise and skills will aid in your salary negotiation. When negotiating for the salary you deserve, it is important to know the pay rate for your position in the industry and geographical location. Attach a number to your worth, so as not to be at the mercy of an experienced employer who can smartly drive the conversation. Researches have shown that employees, who use precise figures in their initial salary request, are more likely to get an offer closer to what they are rooting for.
- What you are offering: While the second factor is centered on the value you attach to your labor, this factor deals with what exactly you are bringing to the organization. For instance, a candidate with a relevant higher degree, or specialized degree should ordinarily be placed on a higher pay compared to those with lesser educational qualifications. Similarly, if you possess a skill that takes time to master your salary range should be high. Having licenses and certifications as an employee will put you in a good position to request a good salary. The point is if your input is the kind that is highly sorted after, endeavor to take advantage of it to secure the highest possible salary you can get.
- Right timing: As a prospective employee, you don’t have the yardstick to request a salary negotiation until after you have been offered the job. There is no better time to talk salary than after you have proven your worth and have perhaps impressed your employer. Similarly, if you are already on a job, the best time to request higher pay is a couple of months before performance review season. Employers are likely to raise salaries after a personnel performance review, so going well ahead will put you in a position to ask for the salary you deserve before the bosses give you any increment they want. Identifying a time that will put you at an advantage on the negotiation table is an important variable to consider before a salary negotiation.
- Future outlook: Employers often ask candidates about their current salaries during the recruitment process. It can be a difficult situation, especially if you are underpaid at your current job; which could be the reason you are leaving. Regardless, it is never a good idea to lie. When responding, give the exact figure of your current salary and extend the conversation to a point where you can explain the numbers you are seeking, focusing on your skillset, responsibilities, your market value, and how you hope to grow.
You shouldn’t be tempted to accept just any offer because you are in dire need of a job, it will eventually affect not just your wellbeing and personal growth, but also, your commitment and productivity at work. This is so because employees who feel under-paid hardly give in their best.
- The cost of living: It varies from one location to another. For instance, the cost of living in Abuja is way higher than that of Lafia, signifying that you will need a lot more money to survive in Abuja than in Lafia. Hence, when negotiating a salary, take into cognizance the geographical location of the organization and how expensive it is to reside there.
- If you can do without the job for the time being: In some cases, the employer may not agree to meet your salary requirement or offer additional benefits that will make up for it. Or even, counter-offer with a salary scale that is higher than their initial offer but less than your benchmark. In these situations, you will have to decide if the job is worth the lesser offer. If the role is less stressful than your current position, closer to home and more flexible, you may just be open to taking the lower salary. However, if not, you should just walk away and seek better opportunities.
Conclusively, negotiation is an art on its own; it requires a lot of research, techniques, tactics, and scripts. The more you do it, the better you become at it. So prepare adequately before you sit on a salary negotiating table and you will end up bringing more money home.