Being paid what you're worth is a crucial aspect of a fulfilling career. Money plays a vital role in meeting our financial obligations and enjoying our leisure time. However, discussing salaries can be a sensitive topic, and many professionals are unaware of what their counterparts in the industry are earning. Payscale has shown this as the majority of people paid above, incorrectly assume they are paid at or below market. As people who are paid at market incorrectly assume they are being paid below market. The only people who seem to be the best at assuming where in the market they are being paid are people being paid below market with 72% of the below market people assuming accurately that they are below market. Conducting thorough and accurate salary research empowers individuals to evaluate whether they are being adequately compensated for their skills and experience. In this comprehensive article, we will explore the importance of salary benchmarking, providing seven valuable tips to collect and effectively utilize salary information in order to achieve success in your next salary negotiation.
When gathering salary information to strengthen your negotiation position, it is essential to be honest about your role, qualifications, and certifications. Focus on salary data for professionals at the same level as yours, rather than higher-level positions that naturally command greater remuneration. The aim is to understand the industry standard for your level and present data relevant to the job you currently hold. Avoid including qualifications that are not utilized in your current role. While considering salary information, take into account geographical differences as well. Salaries can vary significantly based on location, so it is important to be realistic in your assessment. One of our favorite resources to use at Acquired Salary that includes compensation averages for general positions by state is the Bureau of Labor Statistics, Occupational Outlook Handbook. This is a great general benchmark, but the data provided does not always have specific roles. If you use this resource be sure to match the qualifications and day to day description of work to be as close as possible. The research you take into your negotiation is going to be scrutinized for your bias.
The credibility of salary research data is of paramount importance. The gold standard used to be salary surveys conducted by direct competitors of your company, however as pay transparency is becoming more common throughout the United States you can always try and find information straight from the horse’s mouth. Check to see on the company’s career website if they have any positions identical to yours posted and with any luck they have it posted and include the salary range for the position. Alternatively, seek out salary information collected from employers within the same industry, which has been carefully vetted by compensation experts. A way to do this is to check your current company’s direct competitors' career website. If the competitors have your job posted and include the range the range is almost definitely informed by their salary survey even if it hasn’t been published for the public. Be cautious with trade association salary data as it often relies on self-reported information from members, potentially introducing subjectivity and bias. Transparent research that discloses the companies included, the quantity of data points, and the selection methodology provides the most reliable and relevant insights. Pay attention to the presentation of results, particularly whether salaries are shown as an average, median, mean, or mode, with median being the most valuable metric.
Timing plays a crucial role in salary negotiations. Although it can be tempting to react immediately upon discovering salary disparities, rushing into discussions with your boss is ill-advised. Successful negotiation requires careful preparation, and it is often best conducted during the annual performance review. This designated time allows you to focus on what you truly deserve, including a salary that accurately reflects your skills and position. By raising the topic during your review, you ensure your boss is not caught off guard, as they will already be assessing your results and impact on the organization. Take your time to note relevant salary data and wait for the opportune moment to present your case.
At Acquired Salary we understand that you may have discovered a discrepancy in pay so dramatic that discussing during annual review cannot wait. If that is the case still find the right time, prepare yourself with your research, touch up on general negotiation strategies and then schedule time with your Boss and preface the conversation so they do not get caught off guard. The timing of the special case negotiation is important. If at all possible try to get the conversation started when you know your boss is in a good or better mood than normal. The last thing you want is for your boss to be trying to fight fires and you come in and add gasoline to the fire by asking for a raise. Their attention is going to be split and they likely will not give your raise request the proper amount of time and consideration before they decide. The best time to ask for a special case raise outside of annual review would be after you bring a major project or task to completion. This will leverage recency bias as the completion will be at the top of your boss’s mind and they will likely be in a better mood as things are getting done.
Data alone cannot guarantee a raise. Before presenting your salary research, articulate the reasons why you deserve a raise based on your personal professional attributes. Highlight both soft and hard skills you bring to the organization, and quantitatively demonstrate how you contribute to the company's key performance indicators and bottom line. Utilize salary information to support your negotiation, showing how the industry typically rewards professionals with your level of expertise. If you have not read about divergent thinking as an important soft skill, read more about it here as it may be one of the tipping point skills that adds enough additional value to your contributions to the company to ensure successful negotiation.
The way you communicate your salary expectations is crucial. Rather than issuing ultimatums, approach the conversation professionally and objectively. Think about how you would like to hear it. Would you rather have a hostage situation or something framed more diplomatically. For example:
"You're underpaying me by $10,000, so give me a raise or I'll leave."
“Based on some research and conversations with individuals in similar roles elsewhere I understand professionals like myself are providing the same quality and quantity of work, but have a more attractive compensation structure could we discuss how to make mine more competitive.”
Obviously most people would prefer to hear the second approach. The second request highlights that other professionals delivering the same quality and quantity of work are compensated at a more attractive rate, presenting your request as aligning with industry norms.
Employers know that higher salaries grant higher job satisfaction, but it is important to highlight how it uniquely applies to you. Therefore in addition to requesting what you don't have, express your appreciation for your current job and outline the reasons why you value staying within the organization. Emphasize the company's culture and mission, showcasing your alignment with them and how they contribute to your career aspirations. Furthermore, illustrate your successful track record, detailing specific achievements and contributions you have made to the team. Convey your plans for future growth and how a higher salary would fuel your commitment to continued excellence.
During negotiations, it is not uncommon for managers to challenge your request by presenting salary research from direct competitors that suggests your desired salary is too high. To effectively counter these arguments, come prepared with additional reasons and evidence to support your case. It is all about the value you add to the company. Sell what makes you unique: skills, attributes, and accomplishments. If you are one of a kind then a cookie-cutter role comparison will not be able to disarm your request. Highlight the unique value you bring to the team and the company, showcasing your contributions beyond what is reflected in the salary data.
Achieving a career where you are appropriately compensated for your worth is a significant accomplishment. By mastering the art of salary benchmarking and negotiation, you can unlock success and ensure your financial stability. Conduct honest and accurate salary research, relying on credible sources. Time your negotiations appropriately, and support your requests with evidence of your value to the organization. By following these strategies, you can confidently pursue a fulfilling career that aligns with your financial goals and professional aspirations.
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If you find yourself feeling stuck, unfulfilled, or uncertain about your career path, a career coach can provide valuable insights and strategies to help you make informed decisions. Whether you're considering a career change, seeking professional growth, or looking to improve your job search techniques, a career coach can be a valuable partner in your journey to success.
The duration of career coaching varies depending on your unique circumstances and objectives. Some clients find value in a few focused sessions, while others choose ongoing support over an extended period. Your career coach will work with you to determine the most suitable timeframe and frequency of sessions to ensure maximum benefit.
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When you have employees who are getting paid salary they are usually more productive if they are paid right. That is why salary negotiations are much more important. A salary increase plays a crucial role in productivity.
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