The Right Reasons to Negotiate Salary
When you've been offered a position, the thrill of the offer may be offset by disappointment when the salary doesn't meet your expectations. Negotiating on salary can be done, but you much approach the conversation carefully, and under certain conditions:
- When you know that your skills, experience and education are worth more than the offered amount.
- When you know that the pay range for the position is less than the industry average.
- When you know that the cost of living is higher in the area where the job is and the salary offer does not reflect that.
- When you have been made multiple offers with similar salary and benefits packages.
Know Your Value
Before you discuss salary with a potential employers, prepare yourself by doing some research, including:
- Evaluate your personal salary requirements.
- How much do you need to earn? (Be honest!)
- Find out what your skills and level of experience are worth in the job market (i.e. internships, volunteer and part-time work, education level, etc.). You can speak to a Career Lab staff member regarding your experience level and estimated market averages based on experience.
- Research career fields and salary averages for various occupations. Investigate cost of living adjustments to salary based on employment location. Review Salary Information
- Develop a salary range with a high, low and middle range. Make sure your range is not too spread out.
Examine the company's hiring history to find out what they have historically paid or advertised for the position and the experience level required for the position. The Career Lab would be a great place to start, as average salaries of recent graduates are recorded every year in the First Destination Survey. You may also be able to conduct informational interviews or speak to someone in the company if you have a connection to the company in your professional network.
When to Negotiate
The best time to negotiate is after and offer is made by the employer. Avoid discussing salary before an offer is made. When asked what your salary requirements are by a potential employer during an interview, indicate a range, not a dollar amount. For example, "Based on the industry average and my level of experience, I am seeking between $34,000 and $39,000."
Occasionally there will be circumstances where salary is discussed prior to an offer. It is important to handle each situation with confidence. Here are some examples of situations where salaries may be discussed and suggestions on how to handle these discussions:
When responding to an ad or application: Indicate "Open" or "Negotiable" under salary requirements. Under salary history, you can indicate "Competitive" unless it asks for specific dollar amount. If asked for specific salary dollars, you can list total compensations package (base salary, bonuses, medical, profit sharing, etc.). Be aware that most companies verify past salaries with previous employers; therefore be truthful.
When networking or conducting informational interviews, gather opinions on general salary ranges (not specific jobs, but more general positions).
How to Negotiate
Before you respond to an offer, take a breath and plan your next steps, including:
Make sure to get the offer in writing. Take time to evaluate the offer. (One or two days is usually acceptable.)
First, prepare a case based on facts. Facts should include: another higher salary offer you have received, comparison salaries relative to cost of living, industry salary ranges, The First Destination Survey and your own background and qualifications.
Salary is not the only area to negotiate. When salary is non-negotiable from the start, know that you have other options to negotiate. These include: bonuses, salary reviews (consider timing, basis and percentage), health, dental, life and disability insurance, retirement or pension plans, overtime policies, profit sharing plans, vacation and sick days, tuition reimbursement, employee discounts, company car and expense accounts, termination contract, stock options, relocation/moving expenses, professional memberships, and certifications.
Next, if you have a strong case to ask for a higher salary than was offered, present your case:
- Ask the employer, in a tactful and diplomatic way, if the salary offer is open to negotiation. Convey to the employer that you are truly interested in the job. Don't sound as though you are just shopping for the best salary.
- If the employer says no, accept the answer gracefully. You can weigh the options you have.
- Be prepared for the possibility that the employer still may not change the salary offer.
- Present your case tactfully, so if the employer doesn't change the salary offer, you can still accept the original salary offer if you choose.
Accepting an Offer
Call the employer to accept the offer and then follow-up with a confirmation email or letter. Make sure to include the position, start date, rate of pay, and any recently negotiated items in your confirmation letters. Maintain a copy for future reference.
Withdraw all applications with other companies. Let those employers know that you have received an offer and wish to have your name withdrawn from further consideration. It is unethical to continue interviewing once you have accepted an offer.
It is a nice gesture to thank your references. It is important to maintain your relationship with them.
Declining an Offer
To decline the offer, send the employer an official notice via email or letter. State that you are declining the offer, but appreciate their interest in you and the opportunity to interview. You can mention why you are not accepting the offer, however it is not a requirement.
Asking for Additional Time
While it's important not to rush a decision, it's also important to respect the employer's time, too. Keep the lines of communication open and consider this advice:
It is important to be prepared with an explanation of why you need more time. Employers tend to give more time in the Fall semester than in the Spring.
It is important to thank the employer and tell them you are excited about the opportunity, and then say something like:
- "This is a major decision; therefore, I would like more time to consider this offer."
- "I would like to have time to discuss this offer with my family."
- "I have a previously scheduled interview, and it is important to me to honor this commitment. In order for me to make the best decision, I am requesting more time."
It is possible to receive an offer from your second and third choice before your first choice has extended an offer. In this case, you may want to notify your first choice employer that you received another offer, but you prefer their opportunity. If your first choice is truly interested in you, they may speed up their process if possible. If they are unable to speed up the process, or if the company who made the offer is unwilling to extend the deadline, you need to make a thoughtful decision about what to do.
If you need help in making this important decision, schedule an appointment with a Career Lab staff member.