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Negotiating Your Salary in a Bad Economy

This article is more than 10 years old.

Though the unemployment picture is still dim, with the July jobless rate ticking up to 8.3%, some people are nevertheless finding work. Nonfarm payrolls rose by a seasonally adjusted 163,000 jobs last month, the greatest monthly gain since February, according to news from the Labor Department on Friday. That means job seekers are getting new positions every day and confronting one of the toughest parts of the job search, the salary negotiation.

A compact and entertaining book by Wired magazine’s former associate director of marketing, Jim Hopkinson, Salary Tutor: Learn the Salary Negotiation Secrets No One Ever Taught You, lays out some of the basics of salary negotiation in an engaging style.

The best part of this slim volume is Hopkinson’s personal story about how he went from college grad with a degree in Computer Information Systems to unpaid intern to clerk in Staples’ computer department, on to several more jobs that culminated in his last job, in the marketing department at Wired, a division of Conde Nast. Hopkinson left Wired in November, and now works as a consultant and blogger. He peppers his book with first person anecdotes about his career decisions, and lessons he’s learned.

In Pictures: Negotiate a Great Salary in Tough Times

In Pictures: How to Negotiate Your Salary

The most novel aspect of Hopkinson’s approach: he recommends preparing a single-page document he calls the IRS, or Industry Research of Salaries, that takes into account salary data from websites like Salary.com, Payscale.com and Glassdoor.com, and from personal networking. He even suggests candidates hire a designer to prepare the IRS sheet, which would graph the salary range for a position from low to high, and list details about achievements (including years of experience and skills like “accomplished speaker”), specifics about the job (eg. Seattle area, manage a team of 3) and information resources that the salary information sources.

To me, this exercise seems like overkill. By all means, candidates should do plenty of homework and research the salary range for a position in advance. They should also give serious consideration to salary goals and limits, and what sorts of perks, like vacation, benefits and flextime, they would be willing to trade for money.  But the most important rule of salary negotiation is the one Hopkinson notes in another chapter: The candidate should not be the first to name a number.

Hopksinson helpfully covers how to fill out applications that try to force job seekers to name a number. In the blank where it says “previous salary,” he recommends writing, “competititve.” Where an application asks for desired salary, write “negotiable.” Hopkinson advises that even when applications say, in all caps, “APPLICATIONS THAT DO NOT INCLUDE FULL SALARY HISTORY WILL BE DISCARDED,” do not fill in the blank with a specific number. The way around this demand is through networking. Find someone at the company who can put your application into the hands of a hiring manager.

Hopkinson also includes some helpful suggestions on how to answer salary questions in an initial interview. When the human resources rep asks about your desired salary, you can say, “Well, I’ve actually done a fair amount of research while preparing for this interview… what I found is that there was a pretty wide range depending on a number of factors, and I’d really need to have the full picture of all the responsibilities before I know what that range is.”

A creative response to the what-were-you-making question: “Well, the reason I didn’t list my previous salary on the application is that I’ve been freelancing since I was laid off, and the compensation for that would equal $200,000 if you calculated it annually.” Hopkinson also points out that at most large companies, employees are issued policy handbooks that include the instruction that employees should not share sensitive company information with the public. If the HR rep presses you and says she can’t move you on to the next interview without knowing your current salary, you can say, “I’m sorry but the employment contract I’m under with my current employer does not allow me to reveal my compensation. However, I’m sure that when the time comes to discuss salary, we won’t have a problem settling on a number we can both agree on.”

For Hopkinson, the crucial stage of the salary negotiation process comes after the potential employer has named a number. He recommends that candidates always try to push the offer higher. One strategy, when you’re offered a range, is to take the top number in the range and then just repeat it and add the word “hmmm.” So if you’re told the position is budgeted at $65,000 to $75,000, your response would be, “$75,000, hmmm.” Hopkinson encourages candidates to push for a higher number, while emphasizing their experience and accomplishments.  Negotiate for perks like title, benefits, bonuses, vacation and periodic salary reviews.

Reading through Hopkinson’s book, I noted two previous stories we’ve run on salary negotiation. I think he’d agree with our tips. Here are two slide shows on the topic, with a total of 16 pointers.

In Pictures: Negotiate a Great Salary in Tough Times

In Pictures: How to Negotiate Your Salary

This is an update of a story that ran previously.