How to Negotiate Salary After a Job Offer
The most common mistake people make after being offered a job is not negotiating their salary. This is perfectly understandable for fear of jeopardizing the job offer and ending up leaving the interview room empty-handed. However, what many job seekers are not aware of is the fact that most companies actually create some negotiation room for the compensation and benefits that they provide.
Only about a third of people actually do negotiate their salary after a job offer. It may seem harmless but if we look more closely at a newly-hired worker who could’ve earned $1,000 more a month had he negotiated, he would have made an additional $12,000 more on the first year. Then, considering possible pay raises, the amount could be much higher.
About 42% of employers, almost half, are open to negotiating the salary for entry-level positions. 75% of employers are willing to negotiate non-salary items.
Employment start date, flexible working hours, and continuing education sponsorships tend to be privileges that employers are willing to negotiate. The key is to know when and when not to negotiate salary after receiving a job offer.
When to negotiate salary
Let’s look at the times or instances when negotiating salary is okay.
#1 When you have an offer letter
According to recruiters, a common mistake of candidates for a job is trying to negotiate before they are assured a job offer. The key here is to make sure that a written offer is already in place before negotiating. One must be sure first that the employer indeed wants them, as evidenced by a written offer. If the approval is only verbal, a salary negotiation should be put on hold.
#2 When one can clearly quantify their contribution to the company
An applicant’s monthly expenses are not the most important consideration employers make when deciding on a salary, but rather the significance of the job for the company. So, an employee who is ready to clearly state how much he can offer the company can definitely negotiate.
#3 When the job entails a lot of work and extra hours in the office
Admittedly, there are certain jobs that are more demanding than others, and it is just right that people who do these jobs are justly compensated. A new hire should consider how he will be feeling about his salary in the coming months. Chances are that if at the beginning the salary doesn’t feel enough, then it would be no different in the future.
When NOT to negotiate
Meanwhile, the following instances require new hires to think hard before making a salary negotiation.
#1 When the deal is on
Assume that a new hire received an offer letter and the figures there excited him so much he immediately signed the letter. On the way home, he calls a friend who also happens to work the same job at a different company and learns that his salary is $10,000 lower than that of his friend. Without a doubt, a negotiation would no longer be proper and doing so might put the employee in a bad light.
#2 When they have given their best offer
Every company has a budget that they have to stay within. If they have already given their best offer, they may not be open to negotiating anymore.
#3 When there is no reason to negotiate
Before coming to a job interview, a responsible applicant will already have researched the rates in the industry. When the offer is just right or within that range, then a salary negotiation is no longer necessary.
How to negotiate salary
Now comes how one should negotiate salary without compromising his chances of getting the job.
#1 Be ready
As mentioned above, a responsible applicant will not come to the interview without having the knowledge of what to expect salary-wise. Research greatly helps, as there are a lot of websites that indicate the average salary for various positions in different cities.
#2 Be vague about salary expectation and history
It is common for employers to ask about an applicant’s salary history and expectations after they have offered the job. Answering can be risky, as it may turn off the employer if the figures given are too high. To be on the safe side, an employee can say that it would be better if he knew first what the job entails so that the salary can then be discussed.
#3 Don’t jump right into the first offer
This is especially true if the first offer doesn’t seem high enough. We already mentioned at the beginning that salaries are raised based on the previous rate. With that, an employee can carefully ask what the company’s ceiling salary rate is and then go from there.
#4 Don’t only negotiate salary
Though salary is the greatest motivation in doing one’s job, it is not the only thing that can compensate for hard work. For example, a new hire can ask for a more flexible working environment or schedule, or for a professional organization membership. The outcomes of negotiating non-salary benefits cannot be underestimated.
It is every new hire’s right to salary negotiation and employers are well aware of it. It just needs the right tools to be successful at it. A salary negotiation shouldn’t be scary – only a challenge for great compensation.
CFI offers the Financial Modeling & Valuation Analyst (FMVA)™ certification program for those looking to take their careers to the next level. To keep learning and advancing your career, the following resources will be helpful: