How To Negotiate Your Salary
We all have expectations when it comes to our salary, some realistic and others not. While most people will argue that salaries are something people are never satisfied with, without a clear approach to how you negotiate your salary with your employer, you run the risk of under selling yourself.
Coen Welsh, a Namibian Industrial Psychologist, prepared a guide to better express our expectations and improve our salary negotiation skills.
Negotiating Salary Expectations by Coen Welsh
One of the most difficult stages of a job interview is the conversation around you expectations of money.
So how do you approach this delicate stage of the interview without going out of your mind? Some interesting techniques can be applied to increase the likelihood that you get your fair share in these negotiations.
The most common answer I receive when I’m facilitating interviews is to ask for a “market related” salary and in my opinion that is probably the worst answer to give. The words “market related” really means nothing because markets essentially are volatile.
According to The Economic Times “a market is defined as the sum total of all the buyers and sellers in the area or region under consideration. The area may be the earth, or countries, regions, states, or cities.”
Read the article on the definition of markets here
The value, cost and price of items traded [in this case your salary] are as per forces of supply and demand in a market. The market may be a physical entity, or may be virtual. It may be local or global, perfect and imperfect.”
So to try to pin your salary expectations on the“perfect and imperfect forces of supply and demand you are really saying nothing.
My advice on how to tackle this issue of salary expectations are as follows:
You have to consider the company, their business model, the sector as well as the current economic climate. What I’m saying is that a small start-up SME won’t be able to offer you the same salary as an affiliate of a large multinational. So be realistic in discussing salary expectations.
Know your numbers
By actually giving your potential future employer a specific expected salary you are showing them that you know your numbers. You have considered your expenses and have projected what income you need to sustain that. In addition you, if you are currently already employed in a position you have to know the difference between nett and gross salary as well as other benefits you receive. It’s probably best to use a Total Cost To Company figure as this includes fringe benefits too.
Read more about Cost to Company here
On a practical level you always need to explicitly state to the company that you are willing to negotiate. By putting down a marker and refusing to budge a company may see you as inflexible. By showing your willingness to engage in a negotiation shows them that you’re in it fore more than just the money.
Ask for a million!
A final strategy when asked this question would be to say something like: “Well… I’d like to earn a million bucks, but obviously that’s not realistic.”
This strategy works for two reasons. Firstly it eases the mood. Humour allows everyone to be in a more positive mood and lightens the conversation. Secondly and more importantly by stating that you would like to earn a million dollars you are putting down an anchor.
Fortune.com quotes a study where when job applicants declined to name any number in their salary negotiations their average salaries were lower than those who joked about wanting a million, where their average salary rose by a substantial amount.
This study showed that by anchoring salary negotiations at a million you may expect to receive a bigger salary offer.
Good luck to all MYD readers who are currently job hunting or negotiating.
In the words of Drew Carey “There’s no way I can justify my salary level, but I’m learning to live with it.”
Coen is a qualified Industrial Psychologist with a master’s thesis focusing on the Antecedents and underlying Psychological Conditions predicting Employee Engagement. He has studied, lived and worked in London, Cairo, Pretoria and Namibia.
Coen is a founding trustee of Capacity Trust where he currently consults in the people and human resources space for a variety of organisations in Namibia ranging from private sector clients to government and SOE’s.