In late 2010 Google did something pretty stunning.
They announced to their 25,000 employees worldwide that effective January 1, 2011, every single one of them — no matter what their job title was, no matter what department they were in, no matter how good or bad their on-the-job performance was — would automatically receive a 10% raise and a $1,000 bonus. Google even paid the taxes on the bonuses so workers would get the full $1,000. Happy New Year.
Raise your hand if your current company did that for you this year. Or any previous company you worked for. Or if this happens to your friends at their jobs. I didn’t think so.
How to Negotiate Salary: The Negotiation Mindset – Free on-demand, online course from Udemy
The reality is, it’s very rare for a company to automatically give out generous raises (the average is about 3%) and bonuses. It’s up to YOU to ask.
You’re probably reading this article because you feel underpaid and undervalued at work and you want to ask for a raise, or maybe you have a performance review coming up, and you want a little help to make your case and get paid what you deserve.
If it’s any consolation, you’re not alone.
According to a LinkedIn survey of more than 2,000 professionals, 39% of Americans report feeling anxious or frightened about negotiating.
And it’s even harder for women:
Within that same survey, Forbes highlights that only 26% of women said they felt comfortable negotiating compared to 40% for men.
This article is being published on April 9 — Equal Pay Day. This day marks how far into 2013 women must work in order to earn what men earned in 2012. The current wage gap is generally listed as 77 cents on the dollar.
Sheryl Sandberg’s much-discussed book on women in the workplace, Lean In, has topped the New York Times and Amazon.com bestseller list; in her TED talk, the COO of Facebook quotes a study citing: 57% of men negotiate their starting salary, while only 7% of women do the same.
What can you do about it?
Get in the right mindset to negotiate, then take action.
1. The Salary Negotiation Mindset
Getting a raise is a little bit like deciding to get in better shape. Few people immediately flip a switch and start going to the gym and eating perfectly balanced meals. Instead, deciding to drop a few pounds often starts with a mindset shift. Perhaps there’s a college reunion coming up, or an eye-opening report from the doctor. People make a conscious decision… “Starting today I am going to learn about taking better care of myself.”
The same can be said for taking charge of your career. Perhaps you’ve stagnated in your job, or found out that someone with similar skills is getting paid way more than you. You’ve had enough.
However, when it comes to negotiating your salary, most people lack the skills or knowledge to do it. But before you beat yourself up, I like to quote the movie Good Will Hunting:
“It’s not your fault.”
No one teaches you this stuff! Think about how you traditionally learn new skills, and you’ll see that negotiation isn’t a popular topic:
Your family rarely teaches you about negotiation
Besides some MBA programs, most colleges don’t teach salary negotiation
Money can be a taboo subject among friends, so they are unlikely to share details
Your boss certainly isn’t going to give you secrets to earn more
Knowing this, I put together a course designed to get students in the right frame of mind:
How to Negotiate Salary: The Negotiation Mindset – Free on-demand, online course from Udemy
Is this a topic that is resonating? It seems so… I was blown away when the 500th student took the course only 3 weeks after the day it launched.
Here are some of the tips that I share:
- Reality check: The new reality is that the era of lifelong employment, with a gold watch and a fat retirement fund when you retire at 65, is over. Instead, we live in a “gig economy,” where you’ll be forced to continually adapt and pick up new skills throughout your career.
- More chances to negotiate: The Bureau of Labor Statistics shows that as much as 40% of the workforce changes jobs in a year. In fact, surveys show that millennials might change jobs 7 times in their 20s alone. Each time you change is a chance to negotiate.
- The HR perspective: Many people are terrified of going against HR, but here’s one advantage: It’s expensive to find and hire new people. One study showed that considering training time, the loss of institutional knowledge, and the effect on morale of other employees, it costs a company $150,000 just to replace one worker with a base salary of $60k, making it a far better option for them to give you that 5 or 10% raise.
- Preparation is key: There’s no way around it – you have to do your homework. I once practiced 8 straight hours for a salary conversation. But why not? In 10 minutes you could make thousands of dollars. What else have you spent 8 hours doing that is more important? Updating cat photos on Facebook? Watching football on a Sunday? Viewing an entire season of a show on Netflix in one sitting? Pretend this is a test where if you get the answers right, you get $10,000.
- Don’t get anxious, get excited: While many people fear that they will lose a job if they negotiate, the reality is that most employers expect you to make a counteroffer.
2. Take action: How to negotiate a raise or promotion
If getting in the negotiation mindset is like deciding to get in shape, then learning the specific skills for getting a raise is like being handed a detailed workout program. You might think running a marathon is difficult, but consider in 2011 more than half a million people completed a marathon in the US, Fauja Singh finished the Toronto Marathon at age 100, and even celebrities like Oprah have completed 26.2 miles. First they put their mind to it, then they took action.
I teach specific steps in my course:
How to Negotiate Salary: Negotiating a Raise or Promotion – On-demand, online negotiation course on Udemy (Free Preview + Special 40% off coupon code)
Here are some of the tips that I share to negotiate a raise at your current job:
Keep score: From your first day of work, maintain a document that tracks your accomplishments, including meeting sales goals, hitting record page views on your website, major projects you worked on, budget savings, or revenue you brought in. It will be important to highlight these during your review, as you can’t always rely on your boss to keep track of everything. I include templates in my course to track these items.
Get noticed: Choose projects that get you noticed, ideally ones that are revenue-generating. For example, I highlight a case where a company held a competition that allowed any employee to take initiative, create a quick demo, and have a 1:1 audience with senior management. Only 12 out of 100s took advantage. Don’t let these opportunities pass you by.
Don’t whine: When asking for a raise, don’t complain about personal finance issues, such as your mortgage being high or wanting to move out of your parent’s house. This is about your on-the-job performance, so focus on how you’ve brought money to the bottom line or are doing tasks at work that no one else can do.
Time it right: Know your company’s review process (everyone at year’s end? on a rolling basis based on hire date?) and when budgets are done.
Present and be memorable: It’s one thing to tell someone what you’ve done; it’s another thing to show them. I recommend putting together a digital portfolio to highlight your work. Why? 1) It’s a powerful visual demonstration. 2) It puts the control of the meeting in your hands. 3) It allows you to tell a story. Not sure how to get started? I include two downloadable templates that you can customize, tell you what to include, and show how to take your portfolio digital on an iPad or other tablet.
Know your value: Not only do I encourage people to do their homework and know their value on the marketplace, but I suggest creating a salary research document to summarize your findings and use as a discussion point during your review. Once again, I include templates in Excel and Photoshop (5 different options).
I’m excited that I’m able to use Udemy as a platform to help people negotiate their salary and get paid what they’re worth. Remember to follow those 2 steps:
1. Get in the right mindset:
2. Take specific action:
How to Negotiate Salary: Negotiating a Raise or Promotion (Check out the Free Preview and have a 40% off coupon code to sweeten the deal)
About the Author
Jim Hopkinson is the author of “Salary Tutor: Learn the Salary Negotiation Secrets No One Ever Taught You,” and has been featured in Forbes, The Chicago Tribune, and The New York Post. He writes a negotiation column for Salary.com, and has also written online for the Wall St. Journal, Monster, and Wired.
He has spoken on the topic of negotiation to groups such as the Women in Business Conference, and was twice chosen out of 3,200 applicants to speak at SXSW. Known for his high-energy and engaging presentations, Jim also co-founded the “Reboot Workshop” conference and hosts a blog and podcast called The Hopkinson Report, which has been called “audible caffeine.”
Before starting his own business, Jim was most recently a marketing director at Conde Nast, managing the online marketing and social media for Wired.com.