The Beginner’s Guide to Salary Negotiation

Advice & Stories, Earning Power, Featured Article
on December 18, 2014
Beginner's Guide to Salary Negotiation

You donned your finest suit, did well in the first interview, fell in love with the company culture, and now it’s within your grasp: that much-hoped-for, much-anticipated job offer. It feels like time the time to get excited, except for that one big detail you’ve yet to address—your starting pay.

Negotiating a salary, especially if you’re new to the game, represents a tricky proposition at best. Especially after a nerve-racking interview process, it can feel like walking the tightrope all over again. You may think that you need to accept whatever the prospective employer offers. After all, didn’t multiple candidates, perhaps in excess of 100, try to snag the same job you did?

But wait a minute. Did you display that kind of passivity in the interview process?

Just as much as you prepared for your interview, you want to bone up for the salary negotiation process, especially if you’re new to the game. If so, know that it likely won’t signal the last time you’ll have to volley the numbers from across the table—not by a longshot. But with the right strategy, you can help foster a win for both parties. Here’s how to approach the salary negotiation.

1. Be patient. It’s one thing if the company gives you an expected salary right from the get-go. If they don’t, know that it’s never a good idea to bring up salary in the initial interviews. It will be tempting to ask, especially when you hear the inevitable closer, “Do you have any more questions?” Instead, ask questions to land the job in the first place. For example, “What will be expected of me here?” has a subliminal power, because it plants the seed that you “will” land the job. Save the salary discussion for later.

2. Never say yes on the spot. “You will probably get a job offer over phone or email,” says Lauren Berger, the CEO and Founder of and author of the bestseller All Work, No Pay. “If that’s the case, never say yes right away. Take a moment, compare this offer to what you want to make and what you need to make. Always go back with something during first round negotiations—not something ridiculous but something reasonable for your personal goals. Remember, this is just the first paycheck, and you have to start somewhere.”

3. Research the numbers. Here’s where it gets really interesting. According to the U.S. Bureau of Labor Statistics, starting salaries will depend largely on the geographical region where you work and the occupational field you work in. Compare yourself to your peers and refine your search from there. Citing statistics from the Occupational Employment Statistics program, the BLS has figured out a range for more than 800 job types. And the top of the range in one category might edge close to the bottom of the scale in another.

The BLS uses figures from May 2013 (the most recent available) and breaks down these hundreds of jobs into 23 categories. The sweep runs surprisingly wide: from jobs in entertainment and media to fishing and forestry. Let’s say you’ve been offered a job as commercial and industrial designer. The statistics are broken down by both hourly wage and annual salary. Here, as in so many other jobs, the disparity is huge. In the lower 10th percentile, for example, employees are paid $35,530 per year; in the 90th percentile, it’s almost three times as much at $96,570. And if you need to know the median salary, that’s listed as well, coming in at $62,370.

The BLS also has a handy Excel spread sheets you can download to check geographical figures. Not surprisingly, San Francisco (with its high cost of living) offers the highest salaries in many categories: 63 percent more in the health care field than in Chicago, for example.


4. Always negotiate. When a company extends you a job offer, it’s OK to consider yourself fortunate. That said, they want you, which is why they picked you over every other candidate—and that knowledge gives you leeway to bat numbers back and forth.

“As a business owner, I always offer people lower than what I could actually pay them because it’s my responsibility to allow room for small negotiations,” Berger says. “I’m always surprised when someone takes an offer and doesn’t come back and at least ask for more. I’m either going to tell them yes or no, but I’m never going to say, ‘You asked for more? You are fired before you started.’ Either I can do it or I can’t do it.” It’s also fair to ask for 24 hours before making a decision on accepting the offer, Berger adds.

Here’s another way to put it: If you don’t ask, the answer is always no.

5. Network via LinkedIn for counsel. Even if you didn’t find your job via LinkedIn, it can still be a big help in the salary negotiation process. (If you don’t have a free LinkedIn account, get one started right away; it’s the top site for business networking in the world.)

In the top banner is a link for jobs; click that and search out openings similar to the one you applied for by exact title and zip code. Survey some of the posts to see what LinkedIn suggests as a salary range, shown by a sliding bar in the upper right hand corner of the job description.

There’s much more you can do there. Seek out your first-level connections, especially those with solid work experience in your field, and ask them how to approach salary negotiations. Their advice can go a long way in bolstering your confidence.

If you don’t have LinkedIn experience, good old fashioned networking will do. As Berger puts it, “Give yourself at least a few hours to take in [the proposed salary] and speak to some people whom you trust with work information about the offer. Get their take before going back to the company.”

For a new employee, having this kind of information handy is the equivalent of a reporter doing their research. You won’t want to quote your sources chapter and verse to your prospective boss—that smacks of arrogance. But it helps to know what others earn in your field, and what informed sources say, as a reference point for smoother negotiations.

Even if you ask for more money and get turned down, it’s not the end of the world. So much depends on tone: A gentle, well-reasoned refusal always trumps a take-it-or-leave-it rejoinder. Both speak volumes about the work culture you’re considering.

Most of all, exude confidence and respect. It’s what got you this far in the first place, and it sends a positive message to your prospective new team.

Lou Carlozo is a personal finance contributor to Reuters Money, an investment writer for U.S. News and World Report and a columnist at Money Under 30 and DealNews. He served as managing editor at AOL’s WalletPop, and wrote the “Recession Diaries” column at the Chicago Tribune, where he worked on staff for 16 years. He resides in Chicago—and has not charged a dime to his credit cards in almost a year.

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