Salary Expectations: For Companies and Candidates

Everyone talks about how important salary negotiation is but, what does that look like in practice? Below we’ve laid out tips for both companies and candidates to make the negotiation process smoother by setting realistic salary expectations. Follow RaezerConnect’s recommendations to secure talent for your company or a rewarding new role for candidates!

Company:

The “money talk” can be a difficult conversation to have if you don’t have a plan in place. As an employer, when you provide a clear salary range upfront, the negotiation becomes a little easier. Here are RaezerConnect’s recommendations for companies hiring new talent.

When determining a salary range for a new role, you want to take into consideration a few factors. The market value can be a useful resource when determining compensation. Look into what other companies in your industry are offering. This goes beyond just the standard salary. Although it is the biggest factor, it is not the only consideration. If you are offering a lower salary then your competition, is your work/life balance better? Are there formal bonuses? Better benefits? A rapid path to growth? For sales, is there a better commission structure? All these things affect the value of your position and ability to negotiate salary with potential candidates. According to a recent study, 64 percent of those asked said they would rather take a position with opportunity for advancement than one that pays more but does not challenge them.

Next, have a compensation budget. It’s good to have a range to start, the bigger the range the better. Why? Because when you hire from the outside you often have to pay a bit more to attract a new employee. We suggest providing a range of $10K if you publish the search online. If you use a recruiter, give them a slightly bigger range if possible. You have to be very careful, if a candidate believes a job pays $70-$90, they only hear the $90. The reason it’s good for a recruiter to have a bigger range is because they may find an incredible candidate who is worth breaking the budget for. The dreaded counteroffer is also an issue. More and more companies are matching or increasing compensation to retain their top talent. This is why it is important to have that range and offer other benefits which add value, as mentioned before. 

Lastly, benchmark within current company structure. Ask yourself, “Do you have others in the company doing a similar role, how much are they being paid?” Employees are not supposed to discuss salary but the feedback we have gathered from many years of recruiting and directly from owners and CEO/CFO’s, is that they do. Be mindful of that. You don’t want to pay someone coming in way more and potentially lose a loyal employee.

Candidates:

When you purchase a vehicle, it’s important to do some research upfront and have an idea of your expectations in regard to pricing. The same strategy applies for negotiating your salary with a potential employer. By using these methods, you’ll get the most out of your next negotiation.

Networking can be a strong tool when making a decision on salary expectations. It is important to use your resources in order to really get an understanding of what other people are making or what they feel a position is worth. By talking to industry peers, recruiters, or just friends you trust, you are getting vital information needed to an informed decision about compensation.

Next, don’t hesitate to hit the web and do some research. Keep in mind that not all the information available out there is accurate but it can still be helpful. Look around and get a feel for the compensation being offered by other employers for similar positions. This will give you an idea of what the industry standard is for your particular role.

Last, be prepared to be asked about compensation. Usually this comes in two forms: what are you seeking in salary or how much are you making now? The second question is a slippery slope but hiring managers and recruiters still ask. If you know you are underpaid in the market, then give a range when they ask this question. To come up with his range take into consideration your current salary, what your peers make, and what your research indicated is standard. Choose a $10k range you would accept and believe is fair based on all this information. If you are already highly compensated, just be direct. For example, “This is my current salary, I’m sure if I’m the right person we can work out a deal that makes everyone happy”. This puts the ball back in their court, typically leading to an enticing offer which satisfies everyone’s needs.

Lucy
RaezerConnect