→Like a baseball pitcher, the employer has the advantage early in negotiation.
→ Both companies and employees have positive and negative motivations. Neither are evil.
→Each party gets to 50% of the power. Candidates must own their 50%.
→ Don’t expect perfection but know how a lack of preparation will lead to your demise.
In the world of salary negotiation, it is widely believed that the company enjoys a natural advantage over future employees in the hiring process. The most obvious reason is the approval-seeking dynamic that exists between the candidate and hiring manager.
When the baseball playoffs begin, the stakes are raised for all involved. The regular season was just a prelude. Similarly, when the interview process turns into a salary negotiation, hiring managers may seem like a hard-throwing baseball pitcher who stares into the batter’s eyes with intimidation.
If the goal is getting you out, one of the best pitches in the hiring manager’s repertoire may feel like Mariano Rivera’s legendary cutter when it comes at you – if you are unprepared.
This question is: What is your expected salary?
Gaining the Edge
Although it has faded in popularity over the past decade when compared to other sports leagues, Major League Baseball (the MLB) used to be widely acknowledged as America’s ‘national pastime.’1
Basic baseball statistics reveal the pitcher’s advantage over hitters. Besides the slope of the mound, consider that a hitter is successful if he gets a hit 25% – 30% of the time against any pitcher. If a batter can add a few stolen bases or a home run every 5-10 games it further solidifies his success.
If the batter achieves this, negotiation for a higher salary becomes easy. All he needs to do is point to these success rates. Although this part is different, the process is similar in many ways.
According to information provided by Southeastern Louisiana University, somewhere between 25-50% of candidates who go into at least a second round interview end the hiring process with a job offer. Often this includes a salary negotiation if the candidate is courageous and prepared enough to ask for more.
Let’s explore how candidates can raise their ‘batting averages’ to neutralize the natural advantage of the employer with the right preparation.
Getting on Base
The salary question is wielded by employers because if the salary expectations of the candidate are ‘out of left field,’ or unreasonable – they would rather know this early. Many companies also often care greatly about ‘winning’ the negotiation.
If a candidate wants more money than a company is ever willing to pay, why waste time? If he or she admits they are willing to take less than they’re worth, the company can pay less than market rates and no one will ever know. Employers, just like any consumer enjoy a good bargain.
Candidates rightly get nervous about this because they know that the wrong answer can either disqualify them or risk being paid less than they should. When compared to their employer counterparts, there is a discrepancy in the amount of knowledge.
Companies have been through these conversations many times before and larger companies even have paid staff examining the salaries and benefits packages of every employee and how it compares against market rates.
Leverage
Any book on negotiation will tell you that without leverage, there will be no deal. People will not agree if the seeker of the deal does not create enough perceived value to justify an investment. Just ask a salesperson about this dynamic.
Over the course of the interview process, leverage for the future employee is gained incrementally. As the employer becomes convinced that the future employee can offer value, the interviewer’s inherent advantage begins to deteriorate.
Eventually, the employee will approach the threshold of owning 50% of the power in the interaction. This usually happens around the salary negotiation stage. Once you are 50% as powerful, you can start to make your preferences known, but it is up to you to get to that point, recognize this and harness your power.
It is up to you to negotiate, many people never do out of intimidation and a lack of understanding that 50% of the power is there for the taking.
No Research, No Chance
Aside from the tactical aspects of a negotiation, (more on that below), it is imperative to gain enough information to have a chance against the onslaught of resources that the company likely possesses. A rough but accurate estimate of fair market rates based on a candidate’s skill level, the job type, and the zip code must be determined.
These three factors vary wildly depending on location and to further complicate matters, so do the expectations of the company and employee.
Companies tend to want someone who can do the job and they are often willing to pay top dollar, however, like any smart consumer, they appreciate a bargain if they can get one. Future employees want to be paid fairly, even if they over or underestimate the economic value of their skills and experience.
The candidate must be wise enough to ‘know what they don’t know’ and approach the process with caution. After all, a professional hitter would not step into the batters box without practicing or reading the scouting report on the opposing pitcher.
Standard salary negotiation advice proclaims that the ‘first person to throw out a number loses.’ There is wisdom in this advice, although it is not always practical – especially in modern times.
There is one obvious reason. Increasingly online employment applications contain the salary question within the first application. These applications often require a response to this question and worse – they often require it to be numeric with no ability to input a range.
Preparing with Research
Standard salary negotiation advice also suggests to ‘research, research, research,’ after all – knowledge is power. This is fair, however not always useful when much of the available advice simply touts each website in hopes of affiliate link clicks.
As readers of articles on the topic often discover, much of the information is difficult to find and sometimes even difficult to understand.
This resource provides information from the U.S. Bureau of Labor Statistics. This is a powerful research tool because it is based on government data2, rather than the data from other websites which is often self-reported.
The best way to navigate ONET is to use the “quick search” feature. From the list, it is best to choose the job category/title which best reflects your interests and experience. To access salary information based on location, you must scroll far down the next page, almost all the way to the bottom where you can enter a zip code or state.
Once you figure out how to navigate, it is fairly straight-forward. Despite this, there is a downside. No data collection method is necessarily perfect, but it is important to not rely solely on one source.
One downside with this tool is that the job title you are seeking information on will likely be an imperfect match. You may notice that the database tends to lump similar jobs in together. For example, if you research Human Resource Generalist, there is no exact match. The same is true of Customer Service Manager and many more job titles.
The above search for HR Generalist salary information reveals an imperfect match. Part of the accuracy issue is the data only breaks down jobs in groups. This is just how ONET collects data.
It is still arguably the best resource out there available to the average person. It makes for a great starting point.
It is important to cross-reference at least two sources of salary information, if not more. One person who I was working with on job searching recently sought a new job in a different but similar field and got caught a trap.
In her case, she only checked ONET which gave a number that was $10-20k higher than salary.com’s estimate. This led to a precarious situation for her candidacy. The hiring managers balked for unknown reasons but their tone towards her would suggest it was because of her salary expectations were too high.
This must be avoided at all costs. Employers are always looking for a reason to disqualify you and this is one of their favorites.
- Glassdoor and Others
Use of the above tools will provide valuable information, however it is wise to do a little more research than suggested. We cannot compete with the Compensation Analyst’s long list of data.
However, now that we have the tools to research how much a Compensation Analyst makes, let’s explore.
As of this writing, Salary.com provides a range of $64,090 to $78,094 for Compensation Analysts in Boston, MA (Zip Code: 02109). As you can see below, ONET has a different range.
A Word on the Curve
ONET provides a curve which indicates the expected fluctuation that can be expected when years of experience is considered. Years of experience and job performance are by far the biggest indicators of where you be in the pay curve. It is important to be 100% honest with yourself about where your skills truly are because the employer’s expectation will reflect the reality, not a your dream salary.
Salary expectations are a crucial component of career planning and they are a factor that should be accounted for far long before you land an interview with a company. If you need a certain amount of money to cover living expenses and the job you are applying to does not pay it, you are in the wrong place.
Executing Success
Information is useless unless implemented into action. In order to take this information and succeed in a negotiation, the following strategies should be executed.
An Unassuming Nature
No one gets what they want in life by making demands and this is certainly true without any leverage. It can also be detrimental to approach this process with arrogance. The whole interview process should be thought of as a learning experience and the same is true of a salary negotiation.
One piece of leverage is your relationship with representatives of your future employer. Likability is typically the foundation of this and this is perhaps the biggest glue that holds your leverage together. Sacrificing these could cause the employer to quickly reconsider an offer.
An unassuming nature is a fantastic approach. “It seems like” is far better verbiage to get in the habit of using than “This is…”
Transparency
When the hiring manager asks you what you want for a salary, be forthcoming and transparent.
“Well, I did some research but I am concerned about providing a number that will either scare you away from wanting to hire me and I am afraid to sell myself short.”
While it takes courage to answer this way, this level of transparency of motivation is difficult to criticize. Would you be mad at a job candidate who said something like this if you were the hiring manager?
Notice the unassuming nature of the above comment.
Ask Questions
Seek clarification instead of declarations of that which you want. Society has conditioned humans in such a way where question-asking is socially appropriate at virtually all times.
In fact, some argue that in normal interactions, questioners generate power just from the act of asking a question. Once a question is asked, the subject of the conversation shifts. The ball is now in the court of the person who will then be expected to provide an answer.
It is okay to ask them questions. In fact, The ability to put someone on the spot but still retain respectability is a super power. If give you can avoid giving a number first, you can use theirs as a baseline.
For example, you could say something like:
“In my research, it seems that a Business Analyst makes somewhere between $50k and $65k starting out. I wonder if the pay for this role falls within this range?”
Or…
“I wonder how you weigh the total benefits package into the salary that you are willing to offer for this role?”
From there, the conversation can move into a discussion of how your skills and experience affect starting pay, perks, benefits, paid time off, tuition reimbursement, and more.
A Final Word
Salary negotiation is an art, not a science. It is based on relationships and if you convey yourself as a level-headed, amicable person who is firm, but not dominant, the chances of a strong working relationship increase. Trust is a necessary part of the process so being trustworthy is a prerequisite.
Likability, respectful assertiveness, and justifiable expectations backed up by proper research are a difficult combination to beat in the game of hiring because they inspire likability and ultimately, trust.
1 The trendline when comparing the MLB, NBA, and NFL’s television ratings on viewership of their respective championship match processes paints a clear picture of how the MLB is losing viewers.
2 The BLS data is retrieved from an array of different sources. It is far from an ‘end-all, be-all’ tool but the data is collected via different means than the other options listed. Whether it is more accurate is up for debate, hence the reason it is a best practice to reference multiple sources.
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