Salary Negotiation 101Salary negotiation is an inevitable part of taking on a new job, but how do you approach it? Should you go by what you see on Glassdoor? What Salary.com says your position is worth? What you salary was in your previous position?
There isn’t a clear cut answer. Everyone has their unique financial needs and circumstances which must be taken into account, but like most people you don’t want to leave money sitting on the table. Ultimately, how you approach the subject with a prospective employer will call for balancing your unique circumstances and the employer’s unique circumstances. We’ve put together a few approaches and considerations that you should consider when negotiating with a prospective employer.
The cost of your experience.
Experience and what it took you to gain that experience should always play a role in how you value yourself at the negotiating table. After all, going to college probably set you back a cool $30,000 if you’re an average millennial – employers need to be prepared to foot the bill that society has placed on your ability to meet the demands and expectations of the role for which you’re applying.
The costs of higher education, certification, and special training translate into benefits for the employer – take them into account when you’re at the negotiating table.
Standard of living index.
New York City and rural Arkansas obviously have different cost of living standards. Likewise, where you’ll be living will also play a role in how much you should ask for. Two seemingly identical jobs in different locations will have different pay rates.
The costs of transportation, housing, and basic commodities will vary from location to location – do your research and take them into account when you’re at the negotiating table.
Day rate analysis
The day rate analysis is most often used by consultants, skilled tradesman, and independent contractors. It’s rooted in opportunity cost: the loss of potential gain from other alternatives when one alternative is chosen.
If you’re a carpenter who makes $30 per hour making chairs, but a furniture company wants to hire you to manage their production operation – you’d use your earning ability as a basis for how much you’d like them to pay you.
It’s fairly simple, you value your time based on what it costs you to perform your duties with the employer or client based on how much you would earn if otherwise occupied in other revenue generating activities.
Employers routinely ask you how much you were paid in your previous position. A word to the wise – while you may be tempted to lie, don’t. It’s routine practice to confirm your previous pay rate.
This may be an especially difficult question to answer if you’re moving into an unrelated field or if you’re a recent college graduate. The leverage is in the employer’s hands if you can’t use a base earning for your negotiations, but don’t fret.
Research the fair market value for someone with your skill set in a similar job in the region as a substitute for your previous salary or use your previous salary as a basis for negotiating a better deal for yourself. Please Visit Cinq recruitment for more information.