What you lose when you don't negotiate a salary offer
It’s not just money that’s at stake.
Once you’ve made it through multiple interviews and have a job offer in hand, it’s time to talk salary. You know you should probably negotiate your pay, but it can feel awkward. So what’s at stake if you don’t negotiate a salary offer?
Plenty, says Tyron Giuliani, a partner at Optia Partners. He says he worked with a candidate recently who wanted to handle his own salary when he joined a large global advertising agency as a creative professional. The candidate thought he could impress the agency with his work and then negotiate a raise after a few months.
“He took a lower-than-expected salary and entered without a negotiation,” Giuliani says. “What he has now found out is that the agency has strict salary bands and that jumping multiple bands at a time is not possible. He now knows his six months’ expected salary increase will actually require two years of reviews. Needless to say, this has already affected his motivation and resulted in buyer’s remorse.”
In addition, if another recruiter comes knocking with a bigger salary offer, he may jump at it, Giuliani says, and that can make him look like a job hopper.
“It's estimated that people who negotiate earn $1 million more during their career for no other reason than negotiating,” says Katie Donovan of Equal Pay Negotiations LLC. “Even when the offer is better than you expect, negotiate because you expect too little.”
How to negotiate
It’s important to research the position and average pay ranges before you get to the discussion with your prospective employer. Then, Giuliani suggests something like, “From my market research, I understand with the responsibilities and skills required of the role, it pays between $55,000 and $72,000. Based on my experiences and success in previous roles, I feel I fall towards the upper end of the range. I'd be looking for that level of compensation.”
Negotiating is a skill, and it’s important to take advantage of opportunities to exercise it. “That you come prepared into a salary negotiation with relevant and good arguments shows me you are professional and know your value,” says career coach Cecilia Bratt. “That skill, and your mindset for taking this negotiation, goes a long way.”
Look at salary negotiations as building the foundation for the relationship with your new employer, says Stacey Hawley, founder of Credo, a compensation and talent management firm. By avoiding negotiating, “new hires lose out on a critical opportunity to start building their ongoing relationship with their manager.” Negotiating a salary offer is about more than money — it sets the stage for future earnings and career opportunities, she says.
“Start with the assumption that everything is negotiable,” says career coach Day Merrill, founder and principal of coaching firm 2bdetermined.ca. “It’s not, but you’ll find out soon enough where the give is.” In addition, don’t forget consider other factors in your negotiations, such as time off, bonuses, vehicle allowances, health benefits, professional development and more. All of these factors can help you find room to negotiate as you talk about salary.