Tough conversations: Asking for a raise
Low unemployment and more jobs than workers make this the perfect time to seek a raise. What pitfalls should employees and employers avoid in order to have a successful negotiation?
While asking for a raise is never easy, the time may be now for Madison workers.
New JOLTS data from the Bureau of Labor Statistics shows there are 1 million more open jobs than unemployed people nationally, leading many workers to realize there’s no time like the present to negotiate salary in this candidate-focused market with low unemployment.
According to new research from staffing firm Robert Half, 55 percent of professionals asked for more pay with their last employment offer, a 16-point jump from last year’s results.
Wisconsin’s unemployment rate is currently at 3.0 percent, unchanged since August 2018, notes Jim Jeffers, metro market manager of Robert Half in Madison, meaning job seekers have more leverage, especially if they have specialized skills. In Madison, as well as in many cities across the country, candidate shortages are driving salaries up.
“We’re seeing shorter hiring processes in Madison,” says Jeffers. “Many highly skilled job candidates get offers quickly, and this has caused employers with lengthier hiring processes to pick up the pace. Additionally, we’ve observed an increased focus on soft skills. More companies are recognizing that soft skills are very important and much harder to teach than technical skills. They may be willing to hire and train someone on the technical skills if they like the person’s attitude and work ethic.”
Other highlights from the survey:
- 70 percent of senior managers expect some back and forth on pay.
- About 6 in 10 senior managers are more open to negotiating compensation (62 percent) and nonmonetary perks and benefits (59 percent) than they were a year ago.
So, how can workers and employers prepare for salary discussions?
Jeffers offers several tips for workers:
- Do your homework. Research salaries, perks, and benefits using resources like salary guides.
- Reach out for help. Work with a recruiter who can provide guidance or negotiate on your behalf.
- Establish what matters to you. Employees should know what is most important to them going into the conversation and weigh all aspects of the offer. Know your worth — decide in advance what you are willing to bend on and what you’re not.
- Practice makes perfect. Rehearse negotiation discussions with friends or family.
- Be confident. Most employers understand — even expect — professionals to negotiate. Be prepared to show how the company’s investment in you will pay off by providing quantitative examples of your contributions in previous roles.
- Get it in writing. Once you’ve agreed on terms, ask for a letter that outlines the specifics of the offer, such as the salary and any special arrangements that resulted from negotiations. Having everything in writing will prevent misunderstandings down the line.
- Be gracious. Regardless of how the negotiations turn out, be professional and courteous. You don’t want to walk away with a bad taste in your mouth, and you don’t want the hiring manager to have a negative impression of you.
Jeffers also has a few tips for employers:
- Offer competitive compensation. Low pay can be a warning sign that your firm doesn’t value its employees. You want your offer to be at least on par with industry standards (and ideally exceed them).
- Don’t take too long to make the offer. Delays in the hiring process commonly result in employers losing their first-choice candidates.
- Be creative. If you can’t meet a candidate’s salary expectations, look for ways to modify other components of the package, like extra vacation days, tuition reimbursement, or remote work options.
According to Jeffers, workers can often encounter pitfalls when negotiating salary that can negatively affect the outcome of those conversations, such as showing up unprepared for the meeting, making it all about you, or viewing money as the only object.
Additionally, professionals who are interviewing for a new job shouldn’t play games, such as misleading a prospective employer about your current salary or other job offers on the table, or draw lines in the sand and issue ultimatums too early in the negotiation process. Instead, Jeffers recommends looking for common ground and avoiding an adversarial stance. How you conduct yourself during this process sets the tone for employment with the firm, and you want to start on the right foot.
However, workers aren’t the only ones who can make mistakes during negotiations, says Jeffers. Employers also tend to make some common missteps, including:
- Feeling like candidates are lucky to get whatever is offered. Remember that top performers are essential in any economy, but especially today when specialized talent is in high demand and often short supply.
- Being unwilling to negotiate. By being inflexible, you may lose your top candidate to another company.
- Not being prepared. It’s important for hiring managers to have knowledge of prevailing salaries in their industry and geographic area.
Ultimately, Jeffers advises that employees and job seekers don’t just focus on salary when it comes to negotiating benefits and perks.
“If the discussion doesn’t go the way you want it to, it’s okay to politely ask the hiring manager what is preventing them from meeting your salary request,” notes Jeffers. “But while salary is king, there’s more to compensation than pay alone. Employees may want to consider negotiating on things like commute cost reimbursement, childcare reimbursement, a different title, extra vacation days, telecommuting options, flexible work hours, and professional development opportunities. Negotiating on anything can be challenging and uncomfortable, but it helps tremendously to be prepared and have a plan.”
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