You’ve probably heard the job market is hot right now. While that means it’s a good time to find a new job, it also means it’s a fantastic time to get a raise at your current gig.
How can we be so sure that it’s a great time to get a pay bump? Three words: supply and demand. Unemployment is at a 50-year low, people are voluntarily quitting their jobs at the highest rate since before the Great Recession, and wages are finally on the rise. All this means employers are having a tough time finding and retaining talent, and that you have lots of leverage when it comes to negotiating your salary.
Yet ZipRecruiter users who took our annual job seeker survey last year made it abundantly clear they aren’t happy with their pay. Forty percent said they were either dissatisfied or very dissatisfied with their current compensation package, and another 40% said they haven’t received a raise at their current or most recent job. Unfortunately, they may have nobody to blame but themselves. When asked about salary negotiations, 64% said they accepted the first offer from their employer when they took the job.
So whether you didn’t ask for enough when you got hired, or if the market rate for your skills has outpaced your current pay, this is how to ask for the money you deserve and increase your chances of actually getting it.
Know your worth
The necessary first step to securing a pay increase is to do your research. The goal here is to find out what the market rate is for your skills and negotiate from there, rather than using your current pay as the starting point.
“It’s typical for most companies to set a range they are willing to pay for a role,” says Amy Klimek, Senior Vice President of Human Resources at ZipRecruiter. “Find out what that range would be if your employer had to replace you tomorrow with a new hire and you will have a good idea of how much you should ask for.”
This task was easier said than done in the old days, but now there is an abundance of tools at your disposal to research the range. ZipRecruiter salary data is especially useful in this case since it is based on advertised salaries mentioned in active job postings, rather than self-reported figures that may or may not reflect the going market rate.
Timing is Everything
Okay, maybe not everything, but ignoring the business cycle could put you at a significant disadvantage. Just as with buying a home, selling stock, or planting a garden, knowing the right time to ask for a raise will drastically improve your likelihood of success.
“Asking for a raise at the annual review is a popular tactic for many employees,” says Klimek. “But what most people don’t realize is that the decision of whether or not you will be getting a raise at the end of the year has usually already been made by the time your review comes around.”
In other words, if you wait for the end of the year, it may be too late to make your case. The year-end review makes a lot of sense as the time to pop the question, not just because it seems like an appropriate discussion for the setting, but also because budgets have been set for the coming year.
But, Klimek says, “Your manager may have budget set aside for performance-based raises to retain talent that they can use at their discretion throughout the year. If you do plan to wait for the end of the year, shoot for early in Q4, rather than right before the holidays.”
Write a Proposal
Depending on your role and responsibilities, it may not be appropriate to submit a written proposal for a raise to your employer. But writing it down is still a good idea since your request needs to be strategic.
Either way, the heart of your proposal should be a detailed accounting of your accomplishments since your last raise (or hire date), and specific examples of how you have added value to the company.
“A business has to be results-oriented to succeed and every good manager is tracking your performance against an important company metric,” says Klimek. “If you can express your worth in terms of percentage growth in sales or new sign-ups, for example, you will be speaking a language your manager can understand.”
Plead Your Case
The time has come. You’ve researched a salary range that is reasonable based on market data, you’ve chosen the perfect time, and you’re equipped with a detailed breakdown of how you’ve exceeded expectations and impacted the company’s success.
“Employee compensation is a well-thought-out decision based on both company-wide and personal performance. It’s also always tied to a budget,” says Klimek. “That’s why it’s best not to ambush your manager when it comes to salary negotiations. Let them know exactly what you plan to discuss when you ask for a meeting so they have time to consider the budget and confer with any other stakeholders involved.”
There’s a reason why so few people negotiate for better pay when they are offered a job–it can be an uncomfortable conversation. But this is where it pays to put yourself in your employer’s shoes. No matter how strange it may feel to you, this isn’t the first time they have had this conversation.
“If you go in with a well-reasoned proposal for why you ought to be earning more, even if you don’t succeed at first, your employer will respect the confidence and professionalism you displayed,” says Klimek.
What if they say, no?
Because compensation decisions hinge in large part on budget, you may get turned down no matter how much you deserve a raise. But getting a “no” doesn’t necessarily mean it’s time to move on.
“It’s important to remember that salary negotiations are not a debate, but a conversation between you and your employer,” says Klimek. “If a raise isn’t in the cards when you first ask, take the discussion as an opportunity to get a better idea of the specific milestones you need to hit to get the increase you want and set a time to revisit your request.”
Ultimately if you stay focused on communicating your accomplishments and illustrating your contributions to the company’s success, you stand a good chance of getting the pay increase you’re after. Of course, you won’t know unless you ask.