Negotiating skills are essential when it comes to your attempt to increase your salary. Negotiating your salary is extremely crucial to unlocking higher lifetime earnings. Despite the challenges in salary negotiation and the stress associated with it, you should know how to negotiate for a salary and receive a pay that you rightfully deserve.
Negotiating your pay is often an uncomfortable situation, so it is not surprising that 59% of respondents in Glassdoor research did not negotiate and accepted the salary they were first offered. We all want a better salary. However, women in particular are less likely to engage in it due to the social costs of negotiation, which does not help bridge the existing issue of the gender pay gap.
Employees across the board tend to shy away from negotiation as they do not want to come across as arrogant or greedy, or risk disrupting the established workplace dynamics.
A study in the US found that an employee who negotiated an extra $5,000 from a starting salary of $50,000 to $55,000 would earn more than $600,000 over the course of their 40-year career. This figure does not include returns from potential investments, which could bring the number into the millions.
During annual salary review exercises, employers are likely to make a more conservative offer when giving their employees a raise. Their offers tend to be budget-conscious and calculated based on inflation, market averages and tenure.
However, their proposed offer may be less than what they can actually give you, with the expectation that some employees may negotiate for more. If you can successfully negotiate and justify why you deserve it, your boss might just give you a higher salary to retain and motivate you.
effective tips on how to negotiate for a higher salary
One thing to note while negotiating is to remain cordial and reasonable. Be it a negotiation over your base salary or total remuneration package, the salary negotiation process should be collaborative and professional. Threatening to leave if you don’t get what you want or bringing up another job offer will give the perception that you are a disloyal and fair-weathered employee. It also signals to your boss that your motivations are purely financial.
In the case that you’re holding a higher position in the organisation, there is also nothing wrong with negotiating senior-level executive salaries, as long as you're truly deserving of it. Of course, you'd have to back it up with data and achievements.
When you are sure about attempting to negotiate with your boss, you should always initiate by drafting an email or letter to your boss and arrange a meeting for discussion. This demonstrates that you are willing to have an open discussion about your salary with your boss. Just writing an email indicating your demands may come across as being too demanding and it would also be easier for them to turn down your request with a simple “no” over an email.
If you are ready to begin the process, here are some of the best tips on how to negotiate salary.
1. do research
It’s a good idea to do extensive research and learn the current industry average first, so that you know if you should even be negotiating a higher salary. Without doing so, you risk either being underpaid or looking too out of touch with reality by asking for a figure that’s well above the market rate.
Hence, you should do your market research and find out what others with similar skill sets are earning as compared to you. This will enable you to better gauge a reasonable salary range as it serves as a good benchmark to help you set your salary expectations.
If you've just received your first job offer, there's also nothing wrong with negotiating a starting salary. However, there are people who avoid doing so because there is a chance that the salary negotiation could backfire on you.
People can lose a job offer by entering a salary negotiation but it is quite rare. You do not worry about losing your job as long as you’ve done proper research and are requesting a realistic and reasonable salary.
2. know what you want
Now that you know how much your skill sets are worth in the job market, you should prepare some answers in advance to respond to potential questions from your boss. While you're engaging in the salary discussion, your boss might ask about your expectations and it’s advisable to provide a more precise figure instead of a broad range.
Quoting a salary figure from the top of the range instead of the middle or bottom gives you enough wiggle room to negotiate down, which is something you should be prepared to do.
Some studies have also suggested that you should give an exact number as opposed to a rounded-off figure or a narrower range, as it gives the impression that you have done your homework and that you are ready for a proper negotiation process.
3. showcase your value as an employee
Be a good negotiator. Showcase your value by highlighting your contributions and sharing positive feedback from your clients and peers. From the company’s perspective, your value is usually tied to the results you produce. Thus, when making your case, use quantitative values instead of general qualitative statements. Since you’re asking for an amount for your future contributions, you should also bring up ideas and plans for the future that will help the company reach its goals and this will demonstrate your ability as a forward-looking and valuable employee. So, that is what you should say to negotiate salary.
One thing you should do when you’re negotiating for a better higher salary, you must be prepared to justify your request. It is likely that your boss will ask you why you think you deserve a raise and how you have calculated your expected pay. This is where preparation is key - you should go into the salary negotiation process armed with information that will help support your argument that you deserve more.
4. be prepared and confident
When negotiating for a higher salary, preparation and confidence are the keys to success. Likewise, negotiation skills will be crucial too. People who are confident in their abilities are typically perceived to be more competent, which will clearly help when asking for a raise. Project your confidence by articulating your words carefully and being mindful of your body language.
You should also avoid apologising during the negotiation process. Remember, wanting to be paid what you are truly worth is nothing to be sorry about. Apologising for your expectations only gives the impression that you’re neither confident nor entirely convinced of your self-worth, which is not an impression you want to give to your boss.
Additionally, it’s a good idea to dress well when you meet your boss for a discussion about your pay. You may even want to wear darker-coloured clothing such as navy blue or dark grey, as these colours are often associated with strength and dependability
5. establish your minimum acceptable salary
Lastly, you should decide on a specific amount that you're willing to accept without quitting your job. This number should also be the minimum salary threshold that you have discovered from doing your research.
However, divulging this number to your boss right at the beginning of the negotiation process may not be a good idea. Let the process of negotiation bring the number down, but be bold enough to walk away if it dips below the minimum.
should I be asking for a salary increase?
Generally, it's appropriate to request for an increased salary if you're underpaid or given more responsibilities and workload. In addition, it is also appropriate to negotiate further even after you have received the job offer.
However, if you realise that you're already receiving a median average salary upon doing your research, there's still no harm in requesting a pay raise if you think you truly deserve it.
Before you negotiate, you should also consider how long you've been working at your company. You could ask for a raise after a year of working but if you're only 6 months into the job, it's probably not a good idea unless you have a very good reason to back up why you're deserving of it. What's most important is that you have substantial evidence of good performance to support your requests.
Furthermore, asking for a pay raise every year could also give the impression that you are only in it for the money. This type of behaviour and attitude could leave a bad taste on your employer, especially when the company is going through a difficult time.
Apart from looking at the monetary aspect, you could also review your remuneration package in its entirety. There is a chance that while the company is unable to meet your base salary expectations, your bosses are still able to provide you with some other benefits such as better work flexibility as well as dental or optical allowances.
salary negotiation didn’t go as well as you hoped?
If you’ve attempted to negotiate for a higher salary and failed, do not be disheartened and treat it as a learning process. It may very well be out of your hands sometimes.
The team could have been allocated a smaller budget that year due to a pandemic or financial crisis. Other times, the company might simply not have enough funds to meet their employees’ expectations. In this scenario, walking away is always an option.
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If you believe that you are being underpaid for your contributions and the value you bring to the table, then perhaps it is time to look for a more rewarding opportunity that comes with better incentives.
Connect with us and we’ll help you find job opportunities that match your skills, experiences and your salary expectations. You can also speak with our specialised recruiters, who have in-depth knowledge about the industry and job market, as well as employer insights to better consult you on your career search. Alternatively, you can visit our latest jobs and submit your CV.