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Almost a decade ago, researchers Dr. Michelle Marks, George Mason University, and Dr. Crystal M. Harold, Temple University, asked 149 newly hired employees whether they chose to negotiate their starting salaries*. They discovered that those who negotiated, increased their starting salaries by an average of $5,000.  

Chances are likely that their research is just as applicable today. Let’s talk about why you should negotiate your next job offer and how to do it. 

What criteria should you use to evaluate a job offer? How can you determine whether or not a job offer is a good one?

The attractiveness of a job offer is a very personal thing based on the individuals’ needs at the time. It is key that every job seeker know their needs well before going through the interview process and receiving the offer. Assuming we are focused on the dollars in the job offer, break the offer down before reacting to it: 

  • List the salary. 
  • Calculate the bonus if there is one. 
  • Secure the details of the health coverage. 
  • Re-read the job description to remind yourself about the job duties. 
  • Consider the “soft” elements like length of commute, new skills you will learn, and the quality of the people you will work with. 

Research salary information that is available on the web. Glassdoor.com’s salaries and compensation section and Payscale.com are top locations.  

Should you negotiate with potential employers for better compensation? Do you run the risk of losing a job offer if you try? 

In 30 years negotiating my own offers, I have never had an offer repealed due to a negotiation. However, if a candidate is rude, overly demanding, or disrespectful in any way, the company can repeal the offer. In summary, yes, I recommend everybody negotiate. Remember, “If you don’t ask, you’ll never know.” 

What strategies can you – a prospective employee – use to negotiate a better job offer? 

Most important is to begin your negotiations grateful for the offer, highly respectful, and professional, not emotional.  

  • Try to negotiate with your hiring manager rather than a recruiter or other intermediary. The hiring manager has the budget and is the ultimate decision-maker. And they already want you on their team, so they are motivated to ensure you are satisfied.  
  • Write your negotiation out in a letter and e-mail it prior to discussing it with the hiring manager. That way you can outline your request and justification and they can forward it to other decision-makers.  
  • In the letter, keep it brief. Itemize every request you have, provide a target for a satisfactory solution and provide the justification for the request. Whatever facts you can provide the better.  

For example: 

Your Request:

Your Rationale:

Request #1:  Increase salary by 8%  My prior income was at this level.  Request #2:  5 more vacation days  Pre-committed family vacation 

What mistakes do prospective employees often make when trying to negotiate salary and benefits? 

  • Being rude, disrespectful, sounding entitled.   
  • Saying ,“I did my research, and this is below market.” 
  • Being “whiny” or use lofty statements like, “This isn’t good enough,” or “It’s not what I expected.” 
  • Saying, “It’s less than what I was earning in my last job,” when the last job was not the same, similar, or had fewer responsibilities. Not all jobs are the same and it is not a requirement that the hiring company match or exceed what you were earning.  
  • If stock is part of your total compensation, saying, “Well, you can’t guarantee that the stock won’t go up,” or “Stock doesn’t pay my bills.” This shows you are not in it for the long haul and not aware that your contribution can help the stock price, too.   

If you are a new college graduate or don’t have much work experience and want to command a better compensation package, here are my recommendations. 

  • Be realistic! Since you don’t have work experience, the company is taking a higher risk. Plus, you need to be willing to start at an appropriate level and work your way up. Ask for an early review, rather than waiting for an annual review to showcase your efforts and their results. 
  • If you feel you would be good in sales, then look for a sales position with commission on top of a base salary. In that role, the upside can be tremendous and directly correlated to your ability to close deals.  
  • Do your research on market salaries in your city at your target companies. Go to Glassdoor.com or Payscale.com.  

Remember your biggest mistake in compensation negotiation is not doing it. 

* Marks, M. and Harold, C. (2011), Who asks and who receives in salary negotiation. Journal of Organizational Behavior, 32: 371–394. doi:10.1002/job.671

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Thunderbird School of Global Management Alumna Dana Manciagli '84 is the author of "Cut the crap, Get a job". With her 'Career Mojo' column, Dana is the sole syndicated career columnist for the Business Journal nationwide. Her remarkable profile includes a career in global sales and marketing for Fortune 500 corporations like Microsoft, IBM, and Kodak. She has coached, interviewed and hired thousands of job seekers. This article was originally published on her website.

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