How to tell what a company can afford to pay
(MoneyWatch) Given the tight labor market, it's tempting to immediately accept any job offer you might get. But how can you tell if a prospective employer is making the best financial offer for the position in question? Here are six ways to figure out if a company is low-balling you:
Try to make the first move. If possible, discourage the employer from offering you lower pay than you are seeking by specifying your salary range. "The number should be your ideal," said Jack Chapman, author of "Negotiating Your Salary, How To Make $1000 A Minute." "So if I'm looking for compensation in the $60,000 range, for instance, I should start by suggesting that the compensation should be in the $80-$90,000 range." The key? Present industry data, as well as highlighting your skills and experience as usual, to support your salary request so it doesn't seem outlandish.
Use an initial job offer as a starting point. Never accept a company's first offer. "They will always leave a little wiggle room. So just on principle you can consider that you have 10 percent to play with," Chapman said. The worst thing you can do is be shy about bargaining. If you do it with respect, it will come off as confident, not cocky.
Consider declining to specify your salary range. Carer expert Selena Rezvani, author of "Pushback: How Smart Women Ask -- And Stand Up -- For What They Want," said that detailing your salary range shows too much of your hand. Instead, she suggests naming a single number: "Giving a range [conveys] the lowest you are willing to go. Instead, ask for the single highest number that you can rationally defend with objective criteria."
Do your due diligence. Detailed research on the company and industry helped you land this position, so do the same background work on the expected comp. "You can review some online salary surveys or try to find some surveys that gathered data on your specific position in similar organizations in your geographic area," said Sharon Armstrong, author of "The Essential Performance Review Handbook." "Or see if you can find a HR person who is willing to share that information."
Get inside information. "If someone has a trusted friend or mentor within the company, he or she can seek an inside perspective on the level of the salary offer," said Colette Ellis, founder of InStep Consulting. Online sites like SimplyHired.com and Salary.com are helpful, but a current company employee may give you even more accurate information.
Ask for an up-front bonus. If you're unhappy with a salary offer, you can also request more vacation time, tuition reimbursement and other benefits. But you also might see if the employer can sweeten the offer in another way. "Ask for a signing bonus, particularly if it's standard in your industry," Rezvani suggested. A bonus might come from another part of the budget -- and it can't hurt to ask.
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