The Professional’s Guide to Negotiating a Job Offer
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Many job hunters mistakenly believe that when they're hired for a job, they must accept what's being offered to them in terms of salary and benefits. However, this isn't necessarily the case. In fact, in many cases, workers can successfully negotiate better terms for a job offer so they don't end up leaving money on the table. But this is only possible if they ask a potential employer for what they want.
“You get what you negotiate. Your career is your responsibility. Very few things in this world are certain. That includes your career. If there is something important to you, don't presume that anyone can read your mind or will fight for you,” says career coach Carlota Zee. This guide is designed to increase the chances of job-seekers getting what they want from an offer. Continue reading for negotiation strategies, as well as information on what parts of a job offer can be negotiated and how to create an effective counter offer.
Job Negotiating by the Numbers
of workers did not try to negotiate the salary of their current job. (Source: Glassdoor)
52 percent of men
accept a salary offer without negotiating, compared to 68 percent of women.
Many women don't negotiate their salary
because they feel it makes them appear desperate or greedy.
Recent college graduates with degrees
in the following majors are most likely to negotiate for a higher salary:
- Computer science
- Biological and physical sciences
in the following cities are most likely to negotiate for higher pay:
- New York
- Washington, D.C.
- San Francisco
- San Diego
- Los Angeles
(Source: Robert Half International Inc.)
38 percent of millennials
negotiated their first job offers, compared to 48 percent of Baby Boomers and 46 percent of Gen Xers.
(Source: The Washington Post)
People who never negotiate salaries can miss out
on additional earnings of between $1 million and $1.5 million in their lifetime.
Only 10 percent of people
who negotiated their salary were successful in getting more money.
Top 12 Tips for Negotiating a Job Offer
For workers to be successful when negotiating a job offer, they need to approach it in the right way. The following are some tips people can use to boost their chances of getting what they want during the negotiation process.
“Know what your colleagues in your industry are, and aren't, getting. Successful job negotiations depend on preparation, and the ability to make a case for what you want, and why you deserve it,” Zee says. “Most people who aren't successful go into negotiations thinking almost, ‘If they like me, they'll give me what I'm worth.' No. No one knows but you what you're worth. This is your time to make an articulate case for what you want, why it matters and how it will positively impact your ability to do your job.”
Be open to non-cash compensation items.
“Consider accepting items that would be valuable to you in cases where the salary compensation isn't at the level you would like,” says Marielle Smith, VP of People at Inflection. “For example, you can ask the employer to commit to investing in learning and development opportunities for you, such as attending a class or conference in your field. During the negotiation, you can also ask that your role or salary compensation be reconsidered in six months.”
Have a Plan B.
“Always have a ‘Best Alternative To a Negotiated Agreement' or BATNA. You should always spend most of your time ‘negotiating' by first doing the due diligence, homework and preparation to have as many options as possible,” says John Paul Stephens, associate professor of organizational behavior at Case Western Reserve University. “Without a good range of options in your back pocket, you won't have much to use to compare and contrast the offer on the table. Without a BATNA, that is a clear second option you can live with, then you can't really assess the true value of what's in front of you, and you'll have no bargaining power.”
Play it cool.
“When you receive the offer, do not give any indication that you will negotiate,” advises career expert and job search coach Dana Manciagli. “Don't ask ‘Is this negotiable?' or ‘Is there wiggle room?' Simply be very gracious and excited.”
Avoid discussing personal issues.
Although personal issues, like debt, may be driving the need to get a higher salary than what is initially offered, they should be kept out of the discussions. Employers want to hear about the facts of why someone should get a better offer, not information designed to appeal to their emotions.
Just as being likeable can go a long way toward getting a position, it can help during salary negotiations. In order to do this, people should discuss problems with an offer in a pleasant and polite way, and make a case without becoming angry. Approaching the negotiations in a harsh and confrontational way isn't going to make a hiring manager think a potential employee is strong — it's going to make them question the job offer all together.
“I've helped clients negotiate jobs with salaries starting at a quarter of a million (dollars), and I guarantee that they didn't just smile nicely and giggle. We rehearsed endlessly. We researched. We made a plan. And finally, we didn't apologize for the money we believed we were worth,” Zee says. “If you can't convince yourself, it's almost impossible to convince an employer.”
Don't forget the importance of learning.
“Keep in mind that cash compensation or perks aren't the most important aspect of a job offer, especially if you're early in your career,” says Smith. “Often, having the opportunity to learn and get career experience is as important, or more important, than the amount of money you're earning.”
“Don't try to ‘win' in a job negotiation or resort to underhanded tactics — so no lying and no bad manners. Job market etiquette says that if you've accepted an offer, let everyone else know you are off the market. Don't wait to ‘see' if something else comes around or leave the company to whom you've made a commitment hanging,” Stephens says. “If you get an ‘exploding' offer, with one organization giving you a deadline while you're still waiting to hear from others, you'd be surprised at the potentially lenient response you may get if you inform them of this. Folks may give you more time to decide, knowing you're in demand and that you're doing your professional diligence by wanting to weigh all your options.”
Put it in writing.
“Do not negotiate verbally with the recruiter. Instead, write an e-mail letter to both the recruiter and the hiring manager,” Manciagli says. “The hiring manager is the decision-maker and the person who controls the budget and all offer details.”
Ultimately, organizations will increase how much they pay an employee based on the value they bring to their position. To demonstrate this value, people should make a list of all the knowledge and skills they bring to the table that would justify getting an increased compensation package.
Walk away if necessary.
Based on their research of what the market will bear, and their own personal needs, job-seekers should come up with an idea of an offer that is too low for them to accept. If they are unable to get a potential employer to go above that floor, it may be best to walk away from that job. By taking a position under these circumstances, people might end up feeling resentful — which is the wrong foot to start a new job on.
What Can Be Negotiated?
While salary plays a huge part in whether someone will take a job, there are several items in a job offer that workers can also negotiate with a potential employer. This section provides information on the other parts of a job offer that can be negotiated in addition to salary.
Since organizations benefit when their workforce gains more knowledge and skills, access to professional development is an area that employees can negotiate. People may be able to get their employer to pay for their tuition for a degree program or the cost of earning a professional certification. In addition, a job offer can address the cost of continuing education courses, seminars and attendance at industry events.
Employees who drive to work every day may be able to negotiate for reimbursement of gas, mileage, parking and tolls. Also, workers who take public transportation may negotiate for a monthly pass for the cost of getting back and forth to work. Similarly, workers who have to move to another location in order to work at a job can ask for reimbursement for their relocation expenses.
The ability to maintain a healthy work-life balance can make a job offer a lot more attractive, even when the monetary compensation is less than what workers expect. By negotiating for vacation days, flex time and the ability to telecommute, workers have the opportunity to boost the value of a job offer.
Many job-seekers may underestimate the importance of a title, but it can actually have a major impact on the trajectory of their entire career and the importance they have in an organization. As a result, negotiating for a better job title and description can go a long way toward future advancement.
Projecting a professional image is important in any workplace, so employees can ask for an allowance to buy clothing that will help represent an organization in a professional way — which is especially important for those in positions that require meeting with the public.
No matter which items workers choose to focus on in their job offer, they need to handle the negotiation in the right way. Stephens offers the following advice to increase the chances of prospective employees getting what they want:
“Don't negotiate one aspect of the offer at a time. Bundle them together — such as a car allowance and more health benefits as well as moving costs. If you try to work out one thing at a time, it is easier to end up with a poorer overall deal,” he says. “Have a narrative for your demands, like ‘I need all the above since I'm a single parent who needs to transport my family effectively and take care of them, so I can be an asset to this organization.'”
How to Handle Counter Offers
Once people understand what parts of a job offer can be negotiated, it's time to craft a counter offer, which is where prospective workers propose alternatives to the job offer that has been presented initially. This section includes information on how to handle the counter offer process.
Build a case.
Armed with all of the research they have done about the industry and how much those in similar positions are making, workers can build a strong case to justify their counter offer. Job hunters should approach this by explaining what they want and providing facts about why they should get it.
Don't project greediness.
A âwhat's in it for meâ attitude is going to be a turnoff for an employer, so people should avoid coming off as greedy as they create their counter offer. While it's important to ask for what's fair based on what they deserve, and what similar employees are getting, being greedy will only make an organization reconsider hiring someone.
While preparing for a job offer negotiation, Smith advises that people go into it with the right attitude, instead of getting ready to battle with the organization they're trying to work with.
âDon't antagonize the person you're negotiating with. You should be collaborating on an offer together that everyone is OK with,â Smith says. âAlso, you need to be aware of what leverage you have â if you don't have another offer on the table from another company, are you willing to walk away? Again, it's also dependent on context â if you find out that the company's compensation bands aren't flexible, focus your attention on getting more equity or other perks. The bottom line is, you can always ask for more money, but if it sounds like it's not negotiable, then that's good information to know and take heed.â
Counter Offer Samples
Once job-seekers think about what their counter offer should include, it's time to actually write a persuasive email to send to the organization. Before getting started, however, Manciagli suggests that people ask for adequate time to put their counter offer together.
“Companies will rush you to respond to their offer quickly. Why? They don't want to give you time to negotiate! It's the candidate's job to communicate how much time you need,” she explains. “I recommend three to four working days, so if the offer is made on a Friday morning, advise them that you need time to evaluate this generous offer and will get back to them no later than Wednesday end-of-day. Then, dive right into your analysis on every line item in their offer and think of additional things you may want to ask for. Also, do not miss your committed deadline. This will send one of two messages: You're not interested in their position or you don't follow through on commitments.”
Counter Offer Examples
Thank you for offering me the marketing associate position at XYZ Company. I am excited about the job and I know I will make a meaningful contribution to your team.
However, I would like to discuss compensation before I accept the position. Your offer is for a salary of $30,000 per year, however, according to PayScale, starting salary for entry-level workers in this position is $42,000. Also, as we discussed, I did three, year-long internships at marketing agencies, so I bring those years of work experience in addition to what I learned when I was earning my marketing degree. With this in mind, an acceptable salary range for my background would be $43,000 to $45,000 annually.
I appreciate your offer and I know I can add a lot of value to your organization. I look forward to working with you to come to an agreement on an acceptable salary.
Respectfully,Potential New Employee
Thank you for offering me the marketing associate position at XYZ Company. I am excited about the job and I know I will make a valuable contribution to your team.
However, I would like to discuss compensation before I accept the position. Although your organization is my first choice, I received two other job offers with a higher salary, with the highest being $5,000 more than XYZ Company has offered.
I am interested in working for XYZ Company, and I will be happy to join your team if you can match what the other company has offered. I look forward to working with you to come to a mutual agreement.
Respectfully,Potential New Employee
The idea of negotiating a job offer may be new to many people, and some job-seekers may be reluctant to do it. To provide a picture of what to expect during this process, we asked the following experts to provide their insights:
- Carlota Zee, career coach.
- Marielle Smith, VP of People at Inflection.
- John Paul Stephens, associate professor of organizational behavior at Case Western Reserve University.
- Dana Manciagli, career expert and job search coach.
How should people weigh the job offers they receive?
Zee: Consider your long-term goals, consider the actual work you'll be doing, and the people you've met in the office. How do all these things strike you? Consider what's important in your life, and how this job/business will further your personal as well as professional choices. Take your time. Trust your gut. Where are you in your own professional journey? Someone right out of college, for example, will have different issues and decisions than a parent re-entering the work world, or someone who is only a few years away from retirement. Sometimes the best thing is to be old fashioned, get out a pen and paper and write out a pro/con list. This is a great time to talk with a mentor, or adviser, who is older than you, so you can get her wisdom. Where, for example, does your mentor see this job taking you? Knowing what she knows of your goals, does this opportunity make sense?
Smith: First and foremost, you should weigh offers based on the merits of the job and the growth opportunities for your career. An extra $5K in salary compensation is useless if you take the wrong job — take the job that maximizes your career impact and consider the people and culture of the company and whether it's a place where you'll be supported and can grow.
What mistakes do people make when negotiating job offers?
Zee: People panic and lowball themselves, since they're afraid to press for what they really want. Then, unfortunately, they start the job, and are making less money, or having less vacation time, or less chances to do the aspects of the job they really enjoy, and within six months, they've quit. I've worked with a handful of men and women who came to me after scenarios like that, and we had to start the entire job search all over again.
Smith: A mistake people sometimes make is that they don't place enough value on the intangibles that aren't cash compensation or equity, such as career growth opportunities and perks. The other mistake people make is not being gracious. It's perfectly acceptable to ask for more money and other things, but you need to be gracious, polite, thoughtful — otherwise you could “poison the well,” so to speak. These are going to be your colleagues, so you need to start in a good place. Just be careful of the tone and energy you use — you can be firm and kind at same time.
If the negotiation process is handled poorly, will an employer rescind a job offer?
Zee: Yes. I've seen it happen. If you're disorganized or unrealistic, or if you start giving your employer cause to doubt your judgment, yes, that is lethal to a job opportunity. And an employer will more than likely have language inserted into the offer that gives them the right of refusal.
Smith: Yes, they can rescind the offer, but it's unlikely.
What should someone say when they accept a job offer?
Stephens: You can say "I graciously accept your generous offer and am excited to join your team!" You might also ask to be connected with a peer (someone already in your position) and/or a mentor (possibly a peer, but probably someone senior to you), so that you can learn more about your job as quickly as possible.
Manciagli: A nice email letter to the hiring manager and recruiter sharing how excited you are to accept their offer. Compliment the members of the recruiting and hiring team on how great they were (even if they moved as slow as molasses in your mind).
What should someone say when they decline a job offer?
Stephens: You can say "I am very grateful for your interest in me and for the offer, but am afraid I must decline at this time." You don't owe anyone explanations, but you can say that you have accepted an offer elsewhere (they may ask) that you think is a better fit. If this is a company you'd like to stay connected to or eventually move to in the future, then you should insist that you are thrilled to have been offer the job and are very disappointed at having to turn them down.
Manciagli: Be very grateful and honored that they extended an offer, and say “However, at this time, I will be pursuing other opportunities.” They don't need to know why or with who or if you simply decided to keep looking. Naturally, they may ask you what the reason is. You can choose to share or not. Simply say “I did a side-by-side analysis of my offers and the market opportunities and determined that other opportunities are better suited.” You should never say “The commute is too far” or “I really didn't want to work in this city, industry or job.” They will wonder why you interviewed and took them all the way to an offer.
What are the most important things people should keep in mind about negotiating job offers?
Stephens: Think about the big picture, that is why you are interested in this field/industry and how it fits into the rest of your life. What needs will this job be meeting and how does it meet short- and long-term goals? Also, how will this job, and the process of negotiating for it, help you build relationships that will carry forward into the rest of your career?
Manciagli: If you are considering multiple positions, it is virtually impossible to align the timing perfectly, so you can compare two or three offers. Don't play one company off the other at the offer stage. It is bad form to say “XYZ Company offered me this … will you match?” It is a much stronger position to base your request on market data, cost of living, etc. If you do choose to play one off the other, please accept the offer immediately if the company matches. Also, be extremely gracious, appreciative and understanding. Build relationships with your negotiations versus breaking them down. You just built a number of strategic supporters of yours so watch every move you make.
More on Job Negotiating
In this episode of the No B.S. Job Search Advice podcast, career coach Jeff Altman provides job offer negotiation strategies.
This article discusses the language that should be used during a salary negotiation.
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This article provides insights on how to negotiate a job offer.
This article addresses some myths about salary negotiations and sets the record straight.
This class provided by the University of Michigan teaches students tactics for a successful negotiation.
Introduction to Negotiation: A Strategic Playbook for Becoming a Principled and Persuasive Negotiator – Coursera
A Yale University course that provides information on negotiation theory and examples of successful negotiations.
Includes what can be found in job offer letters.
Provides advice on how to successfully create a salary counter offer.
Includes information on how to decide whether to take a job and how to handle salary negotiations if the job offer is the right one.
Provides advice on getting an adequate amount of time to negotiate a job offer effectively.
This video provides 15 job offer negotiation tips.
Career coach Linda Raynier provides salary negotiation advice in this video.
Video provides common reasons why people don't negotiate job offers and why they always should.
This podcast provides information on persuasion and the psychological principles that are used in negotiations. Show topics include dealing with difficult people, negotiating opportunities in the hidden job market, the role nonverbal communication plays in negotiations and negotiation mistakes that can ruin a deal.
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