How to understand your worth and negotiate the best salary
A lot of candidates get uncomfortable at this stage in the recruitment process. There really is no need as it’s a natural part of the process. And, having interviewed thousands of candidates, it’s a part of the process I really enjoyed.
It’s also important to get this bit right and meet your expectations. The hiring manager wants you to feel delighted with the offer, not disappointed.
You are a successful candidate and that’s something to be really happy about. It’s time to negotiate your salary.
Factors to negotiate
Everyone should be aiming for a win-win outcome. It’s important to understand the various factors that are taken into consideration when calculating the right salary. The company will have various factors and so will a candidate. These factors are going to be very different.
- Needs to stay within the budget and manage costs
- Match internal comparisons
- Be competitive against similar companies
- Meet your expectations
- You want to feel your expectations have been met.
- Feel you have the salary you deserve
- You want to feel valued and rewarded fairly
To feel really comfortable, you’ll need to do some preparations even before you get to the offer stage. Understand what you need to earn and what you would like to earn going forward.
Check out your salary range with a couple of salary surveys. Hays and Reed will give you fairly good indicators of salary ranges in different job types and regions.
Get comfortable with your worth
Having a conversation about money can make some people feel a little uncomfortable. However, for a recruiter, it’s just a natural part of the process. Just like inviting you to interview the salary conversation is just part of the process.
For that reason, you need to get very familiar with your figures. Do your homework before even applying for a job. You need to be clear about how much you NEED to earn and how much you WANT to earn.
What you need to earn is usually your personal outgoings and these don’t necessarily form part of the negotiation. For example, you cannot normally negotiate a higher salary just because you have a big mortgage.
These outgoings are personal and nothing to do with how the company would measure or assess your worth. Never talk about your mortgage or financial commitments during the negotiation stage.
- Financial commitments, loans, or savings
- Insurances, home, building, car, etc.
- Family, lifestyle, holidays, hobbies, clothes, etc.
Factors for negotiation:
- Current salary
- Benefits (pension contributions, medical insurance, life assurance, stocks and shares, etc.)
- Technical and behavioural competencies
- Transferable skills
- Competitive salary and market salary data
When you get to the negotiation stage, it’s okay to mention your current salary and benefits. This is often called either total remuneration, total compensation, or the total package.
If you are looking for an increase in salary (and most people are when changing job and company), then don’t just focus on the basic salary. By including the benefits you’ll have a much stronger position when justifying the higher salary.
You could be out of pocket if you only compare the current basic salary to the salary offered. Again, it’s natural to be looking for an increase in salary. There’s a lot to consider when changing jobs and you don’t want to lose thousands of pounds in the process. Therefore, you must evaluate the total remuneration (current salary and benefits) to the job offer.
Research the jobs market
Knowing your worth is really important to be confident talking about your salary expectations.
How do you calculate your worth?
Firstly, review the job boards and start to form an idea of the salary levels for similar vacancies in your location. Location is a really important factor here. Salaries will be higher in London and maybe other larger Cities, compared to more rural areas.
Secondly, review a couple of salary surveys to find out ranges for jobs at your level of experience. These surveys are guides to help you get a good understanding of the market. You may end up with a range rather than an exact figure.
What if the job advert says, competitive salary?
If you see “competitive salary” on an advert I would suggest calling and attempt to get at least a range to work with.
However, don’t make the salary question the first question you ask someone. Have some questions about the job and company and show genuine interest.
Then let the person know you don’t want to waste their time going through the recruitment process without understanding if the salary matches your expectations. You need to do your homework before the call, just in case the recruiter asks about your salary expectations.
A good recruiter will be prepared to answer this question. Because in my opinion, the salary shouldn’t be a taboo subject.
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To negotiate or not to negotiate?
You’ll need to understand whether negotiation is an option before you apply. What you don’t want to do is waste your time tailoring your cover letter and CV. It takes time and effort to tailor your application. You don’t want to go through the entire interview process to find out that the salary is a lot lower than your current.
If you have a contact name on the job advert, give this person a call. Have a general conversation about the role and company before asking about the salary. Then ask if it’s possible for them to give an indication of the salary. Be prepared to give an indication of the salary range you are looking for too.
Be careful you don’t rule yourself out of the process at this stage. Keep the conversation light and ensure they know you are flexible for the right role. Most people want and need to have an income – otherwise, it’s called volunteering! Or it’s a hobby! However, it’s got to be more than the salary, it also needs to be about your interest in the job and the company.
Time to negotiate your salary
Normally the first meeting or interview (formal or informal) is not the right time to start making your demands. Don’t be the person to bring up the subject of salary first. Other than before applying for the job mentioned above.
In the first interview, you are just getting to know each other. I was a recruiter for many years and I did take the opportunity to gather information about the candidate’s current salary and salary expectations in the first interview. However, I made it clear to the candidate this wasn’t the time to negotiate.
You still need to be absolutely clear about your salary expectations at any stage of the interview process. And as already explained, it’s a good idea to have these figures worked out before you start applying for jobs.
Offer stage and job evaluation
It should be fairly clear when you get to the offer stage – they will make you an offer!
Typically, it will be a phone call to first let you know you are the successful candidate and second to make the initial offer.
This first conversation is likely to state the gross salary and maybe explain the benefits associated with that level of role. This is the time to start the negotiation.
If you receive an offer slightly lower than you are expecting, then that’s the best time to start the conversation. It’s not wise to verbally accept the offer without reviewing the total package. You can accept in principle and explain that’s if the numbers add up.
The total package (or compensation or total rewards) means the gross salary and all other benefits such as;
- Medical insurance
- Dental insurance
- Life assurance
- Holiday entitlement
- Pension contributions
- Car or car allowance
- Stocks and shares
- Gym memberships
- Staff discounts and many more…
So, you have all the information you need to negotiate the salary you need and want. It’s important you remain professional and considered. Once you have put your case together and presented the information to the hiring manager let them decide on the next step.
There are still a few more things you can do if they stick to their original offer.
Further options if they say no
If after presenting your case for a higher salary and the hiring manager says no you have a couple more options.
Firstly, ask them to explain their reasons for offering that salary. They may explain the reason anyway, but if they don’t just ask. The hiring manager may explain that you don’t have the qualification that the rest of the team have or you don’t have the same experience.
Secondly, ask if they would be happy to review your salary after such time as you gain the qualification or experience. Remember, agreeing to review your salary is not an agreement to increase your salary.
If they don’t agree to review your salary then you could ask when they are next reviewing salaries across the company. This will then give you an indication of how long you may have to wait for a potential increase.
Normally, you will not be entitled or eligible for a salary review during the probation period. Therefore, you could be waiting longer than a year before your salary is reviewed. This may persuade them to review sooner.