“We would like to offer you an annual salary of 80,000 $,” says the recruiter. You provide your counteroffer saying “For my skills and the role, my expectations are on the lines of 100,000 $.” When the recruiter fights back with “We can extend to a maximum of 85,000 $.” You run of out ideas to negotiate further and you take the offer like you were constrained in a straitjacket.
Do you face similar situations where you wish to negotiate a better deal but you are unable to? You start with a figure in your mind but when the other side negotiates, you use one or two basic steps and when they fail, you helplessly make a compromise. You kick yourself for not being able to negotiate better.
You wish you knew the best salary negotiation tips, don’t you? I will help you with overcoming the problem by teaching you how to negotiate salary with a recruiter. Practice some of the simple techniques provided in the article and you will improve your art of negotiation over a period of time. I do not claim to turn you into a master negotiator but you will negotiate better with these techniques.
You will learn how to demand an offer higher than the planned budget for your new job. You can even negotiate a better raise with your boss this year.
- Why should you negotiate your salary?
- Salary Negotiation Tips for Salary Offer
- How to negotiate a salary offer
- 5 Important Tips: How to negotiate salary for a new job
- 5 Other Salary Negotiation Tips for a new job
- What not to say during salary negotiation
- Frequently asked questions
Why should you negotiate your salary?
Sometimes the raise seems small and the effort does not seem worth your time or effort. You might wonder is learning how to negotiate salary is important at all?
Let us take an example. You and colleague work on similar roles where you earn 100,000 $ and your colleague earns 107,000 $. How much of a difference do you think would exist between the two of you during retirement?
Assuming equal raise percentages and promotions, you will need to slog your ass and work for 8 more years to match the net worth of your colleague who earns 7,000 more annually.
Surprised? Welcome to the world of compounding. A few thousand seem meager today but when they compound over a period of 20+ years, the additional difference grows like a bamboo tree. The growth seems small at first but over time, the size increases by leap and bounds.
If you did not realize the importance of negotiation before, I hope you do now. The extra 10,000 $ you earn now will compound and pile up by exponential amounts over many years. Do the numbers convince you to learn how to negotiate salary for job offers now?
You would have heard about starting early on investments in stocks and mutual funds. The same growth applies to salaries too in some aspects.
Negotiation does not only apply in cases of salaries. You negotiate on an everyday basis. You and your friends decide on the timing to catch up, you and your boss decide the deadline for the project, you and your spouse decide the restaurant to dine out. While such situations occur on a daily basis, negotiation happens in subtle ways in all such areas whether you realize it or not.
Salary Negotiation Tips for Salary Offer
The tips in the article will cover areas of salary negotiation during interviews. Many of the tips do not only help you negotiate salary. You can tweak the techniques and apply the same methods to achieve great results on other negotiation and persuasion too.
When do you negotiate for a higher salary? When you look for a new job.
When joining a new company, employees accept the norm and believe that the numbers stated by the recruiter are fixed. If you believe the same, you have to change your opinion. If you approach the situation with a plan, you can stretch the chewing gum to the moon.
How to negotiate a salary offer
Who does not love a higher salary when joining a new job? Well, isn’t that like asking doesn’t a dog love a bone? Just like dogs love bones, everyone loves a higher salary.
You will try your best to squeeze out the highest possible salary while the recruiters try their best to hire the candidate without having to shell out too much.
However, most people are unaware of the techniques to maximize the offers they receive. The most common technique is making a slightly higher demand knowing that the recruiter will negotiate and reach the middle.
For example, if you wish to receive an offer of 80,000 $, you make an ask of 100,000 $. You expect the recruiter to negotiate and you both reach a middle ground of around 80,000 $ which matches your target.
Using this technique to negotiate salary offers like going on war today with an army of soldiers on horseback. Even if you have the best soldiers and horses, your enemy will shoot you down.
The recruiter can counter saying “We cannot extend the offer beyond 75,000 $. We consider the offer fair and reasonable given your roles, skills, and experience.”
Aren’t you like a deer caught in front of headlights now? You wrack your brains as a few seconds of silence pass by. Unaware of ways to further negotiate and with the fear of losing the offer creeping in, you accept the offer with a long face like a soldier who lost the battle.
When the recruiter makes a counter offer lower than expectations, most people have no further arrows to fire. Therefore, having a quiver full of negotiation arrows help you negotiate better.
Negotiation does not only involve counter offers. In fact your process of negotiation starts early. If you act according to these steps outlined below, you have a much higher chance of walking out with a larger number.
5 Important Tips: How to negotiate salary for a new job
I have mentioned 5 important salary negotiation tips along with 5 additional ones. The first 5 are uncommon and lesser-known. Having them in your kitty will vastly boost your knowledge on how to negotiate salary offers.
1. Do not provide an estimate before the interview:
During the initial screening, a recruiter calls you or sends an email. In some countries asking for your current salary is the norm while some countries do not dig those details. Irrespective of your location, do not reveal your current numbers during the phone call. You can dodge the question by saying “My company is completing the process of my promotion after which I will know the final figure.”
If the HR asks you what your expected salary is, do not state a number before you attend the interview. You must somehow figure out based on online research if the specific company pays your expected CTC for the role. If you state a number and your number is higher than a threshold they will reject you without an interview.
Recruiters go by the numbers decided for the position but someone in the interview panel has the authority to extend the numbers. You must aim to reach the person in power.
You must impress the interview panel. Once you do, you can easily negotiate a higher salary even if you expect a number above their threshold. The person in command usually has the authority to increase the initial number they had in mind for the role. But of course, you need impeccable skills to make that happen. Nothing comes easy.
As a rule of thumb do not state a figure when you negotiate salary with the HR over the phone.
2. Use a salary range with the lowest number being your expected salary:
This tip is from the book Never Split the Difference by Chriss Voss, the FBI veteran who was responsible for negotiating with terrorists during any hostage situation.
If you state a single figure such as 100,000 $, almost always, the recruiter will come back with a 10-30% reduced counter offer like 80,000 $. After a couple of back and forth offers, you will agree to a figure in the middle like 90,000 $. Do not make that mistake.
If you are expecting 100,000 $ state your range as 101,500 $ – 124,500 $. When you state a range, countering with a figure lesser than even the lowest number in your range is an uncomfortable feeling for the recruiter.
I am not saying it can never happen. The recruiter might have a tight budget and inform you about the largest possible number they can stretch up to. But with most recruitment in the current world, the recruiters do not have a low cut off number for hiring.
When your number falls within their range, the recruiter has no choice but to at least offer you the least value in the range. As Chris says, never split the difference.
3. Do not use round figures:
Again, Chris Voss presented this tip in his book Never Split the Difference. Never use a round figure like 90,000. Using a figure like 124,500 $ makes you look thoughtful for some reason.
Are you thinking “Doesn’t such a number seem strange?” Yes, it does and you want exactly that. When you state a bizarre figure like 124,500, the other person will be taken aback and will have a hiccup before coming up with a counteroffer.
If they ask how did you come up with that figure, make sure you have an explanation. You do not have to prepare a detailed explanation because no one will total it to the dot. Just a sensible overview will suffice.
Do not push this trick too far and state a number like 124,581. Recruiters have their brains intact and will know you are pulling numbers from thin air.
4. Use a metaphor which the interviewer can relate to:
Anne Miller presented this tip in her book, The Tall Lady with the Iceberg.
A metaphor is a comparison to a real-life case different from the current topic. If you use a metaphor you have used all the 5 best tips of how to negotiate salary offers.
You must target and use a metaphor which the interviewer can relate to. For example, if you know the person in control is an avid Game of Thrones fan, use a metaphor like “there will be many other candidates who fight like Oberyn Martell, but there will be only one Ser Arthur Dayne. I can be the Ser Arthur for your company.” Ok, that went a little overboard, but you get the point. When you resonate with the other side at a personal level, they have a much higher chance of agreeing to your demands.
If you do not who know the interviewer is or cannot find details, use a metaphor that relates to the company. For example, if you are interviewing for a beer company you can mention, “the quality of my work is like a perfectly poured mug of chilled beer without the froth on top.” Plan and come up with great metaphors beforehand.
5. Ask open ended questions
Do not ask questions that can be answered with a “Yes” or “No”. If the recruiter has trouble answering with a yes, you will receive no as the answer.
For example, if you expect 80,000 $ and the recruiter offers you 60,000 $. If you ask the recruiter “For my role and the value I provide… Can you provide me an offer of 80,000 $?” If the recruiter is not certain and cannot say yes, your questions forces no as the answer.
If you frame the same question as “For my role and the value I provide I was expecting a range of 82,000 – 98,500 $… How can you help me with the problem?” Such questions cannot be answered with yes or no. You have left room for the recruiter to come back with a solution with say a salary of 70,000 $ and benefits worth 15,000 $.
When you ask the other person to solve your problem, they will. Also, they will think you possess fantastic communication skills. Surprising? Try it out. Chriss Voss has used the same technique to negotiate with hostages.
5 Other Salary Negotiation Tips for a new job
In addition to the previous 5 important salary negotiation tips above, you can use 5 more below based on the situation. You can master the art of how to negotiate salary offers even without the next 5 tips. The first 5 are uncommon and powerful while the 5 below can also swing a magic wand when used at the right time.
6. Do not bring up the salary discussion
Do not speak about your expectations until the fag end of the interview process. You will grab a better paycheck, the longer you delay the monetary part of the interview. You will come across as pushy if you initiate the salary discussion while the rest of the interview process is on.
7. Make the first offer and set a high anchor
As per traditional methods, people will advise you to wait until the recruiter makes an offer. You do not want to lose out on the possibility of a higher package than you expected.
Oh, come on! Let’s be realistic. The chances of the recruiter offering more than your expectations are like expecting rain in the desert. The rain could happen but the chances of rain when you visit the desert are slim. If recruiters threw away money no one would need to learn how to negotiate salary offers.
Recruiters undergo training to make the least possible offer to close the deal. For example, the recruiter offers you 55,000 $ when your expectations were 80,000 $. How can you make a counteroffer of 80,000 $ without sounding greedy? Not so easy, isn’t it?
When you make an offer first, along with a range as per the earlier tip, you stand a better chance. Your initial number serves as the anchor for the rest of the negotiation. It is in your best interest to set the anchor high.
You might be thinking “What if I quote too high?” Well, you are quoting a range where the bottom of the range is your expectation. If they cannot meet the lowest point in your range, you will end up making the compromise. It will serve you best if you move on to another offer.
8. Compliment the interviewer
Who does not like to hear good things said about ourselves? We all do. So use it to your advantage. You must only compliment the interviewer in a subtle fashion. Do not make your words direct or obvious.
You have to make the compliment seem genuine and professional. Comments on personal elements such as looks, hairstyle, fashion are a big no. You can appreciate the way the role was explained, the clarity of communication, the interview process and so on. Compliment only on the professional areas you noticed.
A technique I used previously was to stuff a compliment when I ask a question. For example, I ask “The interview you conducted was unique, interesting, and challenging compared to other interviews I have attended. I must say I am impressed and looking forward to joining your team. So what would….(add a question about the role)”
When you give something, as human beings we tend to reciprocate. The recruiter does not have options to reciprocate the favor. Providing you better numbers will serve as the way to reciprocate.
This is one of the salary negotiation tips which is controversial. Use your own judgment to decide if you would like to apply it.
9. Negotiate with the mindset of walking away from the offer
I do not mean you should negotiate such that you appear to the recruiter that you are walking away. You must convince yourself about being willing to walk away from the offer. When you negotiate with such a mindset, your approach will be more powerful you will sound less desperate or pushy.
Do not apply this trick if you really need the offer. You should never be in a position where you desperately need an offer. Try pursuing your dream as a side hustle by reading 9 steps to quit your job and follow your dream
10. Make the conversation about you and the organization
How would you feel if a car salesman lauds the speed and acceleration of a sports model when all you want is an economical car with good mileage? A good salesman highlights the features of the car which matter to you the most.
You must mention how the company benefits from your joining. If you negotiate only from your perspective, the recruiter will do the same. Point out what value you will add, how the organization will benefit from your joining and what will they miss if you do not join.
Keep the tone of the conversation as collaborative as possible. The moment you cross the line and change the tone into argumentative or aggressive, you lose the battle.
What not to say during salary negotiation
Salary negotiation tips are just one part of getting a better offer. You must ensure not making any blatant mistakes during the conversation too.
Just like the right things to say, you also have certain areas, topics and words to stay away from. A crucial part of learning how to negotiate salary offers lies in knowing what not to do as well.
I want a higher salary
Sure, you do. Who doesn’t?
But guess what? No one gives a damn about what you “want”. You must put across your expectation as a number which is suitable for the value you will provide and the experience you carry. If you want a higher salary because you want more money, you are shooing the recruiter away.
Citing personal reasons for a higher salary
If your personal circumstances such as moving to a new city, having a baby or a new house have burnt a hole in your pocket, can you cite such reasons for a higher salary? No freaking way. Do not even think about it.
On the surface, the ask based on personal circumstances seems reasonable. But only from your shoes. Let me turn the tables. You are looking to buy a car for 20,000 $ and the sales executive asks you to pay 25,000 $ because he went through a bad divorce recently. How does the ask sound now?
All your personal circumstances are “your” problems.
I have offers from other companies
While you can use other offers to negotiate a better offer subtly, do not be blunt and direct about it. You will offend the recruiter if you say “Your offer looks low to me. I have better offers from other companies.” You might think you seem more desirable but by using the incorrect words and tone, you sound like fingernails scratching a blackboard.
I am not saying you should not use offers from other companies to your advantage. You can put the same message which will make you seem a better candidate by saying “I am interested to join your organization for the challenging roles and responsibilities. However, I have 2 other offers which offer me XYZ. How can you help me solve the problem? (open-ended question)”
You will screw up if you act arrogant about the offers you already have. Using the right words makes all the difference.
I work harder and longer
No recruiter will offer a better salary because you claim you work harder. Negotiate for the value you provide not for hypothetical claims.
Stating hard work as the reason for better numbers is like stating I will do my best. Everybody says the same about themselves. Nobody gives a rats ass.
I know person X in your organization earns …
Why should someone pay you based on what another employee is paid? Every company has a varied salary for the same experience and roles. Factors such as joining experience, appraisals, performance, promotion, role changes, retention can play a part in the current salary of an employee. You have no right to ask for a higher salary because you think you are on par with person X.
Frequently asked questions
When should you start negotiating the numbers?
The best time to fix the roof is when the sun is shining. If you wait to negotiate until an offer is released, you have lost already.
You must bring up the topic of salary as the final step of the interview. However, your techniques of negotiation begin as soon as you pick up the call the first time for the screening. Throughout the process try your level best to portray the value you can provide and how the organization will benefit from you.
In every round of interview, you go through, convey your value in different ways. The organization cares more about what’s their benefit than what’s yours. Do not be the “It’s not about you. It’s me” person. The more the number of people convinced about your value, the higher your final offer will be.
Remember, the recruiter does not decide your final number in most cases. The input from the hiring manager and the other members of the interview panel shapes the final offer.
Apply the salary negotiation tips mentioned above throughout the entire interview process. If you have read through all the 10 tips on how to negotiate salary offers, you will begin wooing your magic early.
Should you ask for time to consider the offer?
Accepting the offer right off the bat makes you seem as desperate as an ant searching for food. Try and seem unsure about the offer and mention you will think over the offer and get back. You can also add a quick note about comparing the offer with other offers you already have(even if you do not have any other offers).
Reach back to the recruiter with a counteroffer within a 48-72 hour window. If the requirement is urgent, you should consider reaching back sooner.
Should you negotiate over phone or email?
Talking to the recruiter over a phone call builds a better rapport and leads to chances of a better outcome. Most people feel uncomfortable to negotiate over talks. You feel so because you lack practice. Get over your fear and discuss over a call. The human touch always adds value.
If you believe you will make a terrible impression on the phone, you can take the email route(though I would not recommend it). Using email is like a double-edged sword. While you get time to think and carefully craft your response, so does the recruiter. Also, over email, one reason at a time gets picked up. A long email with many bullets makes the negotiation harder.
You might believe recruiters will have the edge over you on the phone because they negotiate on a daily basis. Guess what? Most recruiters only encounter people asking a 20% higher amount than their offer, eventually settling down for 10% higher. When you use the techniques outlined above, you catch most recruiters off guard. You will seem like the black polar bear which is rare.
You have the edge while talking because the recruiter has to reply right away. If you use the same techniques over email, the recruiter can think, consult others and come back with a smart counter offer.
Knowing how to negotiate salary will make a huge difference to your finances over the years.
Getting a better offer is all about saying and doing the right things the right way. The strategies for negotiating salary provided work based on the human psyche. You do not need to have the persuasion skills of a charmer to negotiate with a recruiter. You do not need to have sales experience either.
Be confident and apply the salary negotiation tips you just learned. Even though you know only the theory of how to negotiate salary offers for now, applying these tips isn’t that hard.
Remember, if the interview process has reached the point of discussing salaries, the organization is interested in you and wants you to hop on board. You are not selling a credit card to an uninterested soul seated elsewhere. You are talking to a person interested in your skills and value. Therefore, keep your talk collaborative and friendly.
The more friendly and gentle you appear, the more flexible the recruiter will be. Be nice but be firm.
Let me know the challenges you face in asking for a higher salary over comments.
Maxim Dsouza has spent over a decade experimenting and finding various time management techniques to improve his productivity. He strongly understands the fact that time is a limited commodity and tries to make every second count. He has extensive experience in leadership in startups, small businesses, and large corporations.
He has helped people of different professions and age groups gain clarity on their goals, improve focus, revise their time management skills and develop an awareness of their psychological cognitive biases.