How to Approach Salary Negotiation with a Job Offer

Receiving an offer for a new job can be an exciting opportunity. Among other things, it could also be a chance to increase your income by a substantial margin. However, the majority of people who receive job offers don’t negotiate their salaries. Less than 40% of job applicants will attempt to negotiate their salary. Most of the time, they feel as though attempting to bargain would be bad form or make them appear money-hungry instead of appreciative for the opportunity.

While accepting the offer on the table might streamline the process of transitioning to a new job, it could also mean missing out on substantial amounts of income over the following years. Some of your benefits, such as retirement account contributions, will hinge on percentages of your income. The higher your initial income, the higher each percentage amount will be. Over time, this could add up to a tremendous amount of money.

If you’re wondering how to negotiate salary after receiving a job offer, the most important thing to remember is that a job offer means the company wants you to work for them, but they will look elsewhere if you’re too difficult or demanding at the negotiation table. Ultimately, the best approach to salary negotiations following job offers is to look for the win-win scenario. When you accept the offer and walk away from the negotiation table, the employer should feel like they saved money and got a fantastic employee at a great value, and you should feel like you met your expectations for compensation.



Do Your Research

It is absolutely crucial that you do not attempt to negotiate a salary unless you have done your homework. Before your negotiation, take the time to research similar positions in your industry and area of expertise. It’s also important to look into geographical differences in average income. For example, the average income of a software engineer in Los Angeles could be very different from the average income of a software engineer in Philadelphia, so make sure you tighten your research pool as much as possible.

You should walk into your salary negotiation with a firm understanding of what kind of compensation the position you’re applying for typically commands. It’s also vital to know what competing companies would offer for the same position and take cost of living into account. For example, if you receive two job offers for the same amount of compensation in two different areas and the cost of living is much higher in one of them, then the job offer in that area probably isn’t the best choice.

Walk into your salary negotiation armed with as much information as possible. While not every employer will attempt to low-ball a job candidate, every company has a mission to streamline their operating expenses and overhead as much as possible. It is only natural for an employer to wrangle a new employee for the lowest salary possible. As long as you know what you should be making based on industry averages in the area and the credentials and experience you bring to the table, you can be confident in asking for more money if the initial offer is lower than you expected.


Try to Avoid Mentioning Compensation First

In any type of negotiation, it is typically a bad idea to be the first one to bring up the subject of money. It is not uncommon for employers to simply ask job candidates flat out how much compensation they want for an offered position. If this happens, you can quite easily and eloquently deflect the question by responding that you would need to consider the complete compensation package.

Ultimately, any hiring manager will have a ballpark they are willing to work within. Some may be more pressed than others to explore that range as soon and as definitively as possible. Your goal should be to encourage the hiring manager to reveal the upper limit of what they are willing to offer. If you provide the hiring manager with your range of expected salary, you lose all your negotiating leverage. If there is one golden rule for how to negotiate salary, it is to allow the hiring manager to make the first move when it comes to mentioning monetary figures.


Know Your Worth

One of the most common reasons that people who receive job offers do not attempt to negotiate raises or initial compensation is fear of seeming entitled or greedy. They don’t know how to negotiate salary because the idea of doing so seems too brash. However, the reality is that a company offering you a job needs someone like you to fill the open position. They are willing to pay for the experience, credentials, and overall value you could provide to the company. It’s essential to recognize this and remember it if you feel as though an offered salary is too low based on your research.

As you do research into the offered position and others like it in the area, you should be able to establish a “walkaway number,” or the number that is too low for you to consider accepting the position. If an employer offers a salary that is at or below your walkaway number, there could still be a possibility of the employer increasing the offer to a certain point. You’ll need to turn down this low initial offer but do so in a way that it creates a dialogue about how far the employer is willing to go to convince you to join the team. Here’s an example of how to do so:

“Based on everything I’ve researched about this position and others like it in the area, I don’t think that salary offer accurately reflects the typical compensation for similar positions in the industry or the value I could provide to the company. My compensation expectations are (salary range). What can we do to arrive in this ballpark?”

Stating your refusal in such a way shows the employer that you are still interested in joining their team, but you know the initial salary offer is too low. The hiring manager conducting the negotiation will likely have an upper limit for compensation they are able to offer. Exceeding this limit will likely require special approvals. Most employers will only consider breaching their upper limits for candidates who are exceptionally qualified and/or highly experienced. If you are firm in your belief that your skills, professional credentials, work history, and overall value potential to this employer deserves higher compensation than what the hiring manager offered, state your refusal in a way that keeps the dialogue going but reminds the manager that there are other opportunities available to you.


Maintain Professionalism

Negotiation is a challenge for many people, and salary negotiations can be some of the most daunting opportunities for job applicants. For others, they might get ahead of themselves and seem compelled to squeeze every last penny they possibly can from a job offer negotiation. Instead of falling into either of these extremes, strive for achieving a balance; don’t sell yourself short, but don’t get so full of yourself that you feel as though you can negotiate an exorbitant offer with minimal effort. Be confident, not cocky.

Don’t spend too much time talking up your professional record as if it’s a bargaining chip. Instead, explain how your skills and experience are potentially valuable assets to the employer. Provide them with specific examples from your career that demonstrate your capabilities and worthiness of a higher salary than what was initially offered. Couple this with thorough research into the offered position and you have a winning formula to negotiate your salary.

Too many people think haggling is unacceptable during a salary negotiation. However, this is only partially true. The wrong kind of haggling will lead to an abrupt end to negotiations with one or both parties walking away from the table in a lose-lose scenario. Aggressive haggling could not only lead to an employer retracting a job offer or terminating negotiations entirely but also prevents the candidate from seizing what could have been a fantastic job opportunity.

One of the best tactics for haggling with professionalism is to split the difference. This is a perfectly reasonable approach to salary negotiation if you know your worth. For example, if the employer offers $80,000 for a position but you were hoping for $90,000, politely remind the employer of your qualifications and the value you can add to the company before telling them you were expecting something in the ballpark of $90,000, but you’re willing to split the difference to $85,000. If this is below the employer’s maximum threshold, this could work out very well for all parties. You get more than the initial offer and the employer walks away from the table believing they got a great deal on a valuable new employee.


Stay Flexible

When it comes to salary negotiations, most hiring managers are accustomed to haggling over salary numbers, but they’re not as used to bargaining over benefits. It’s possible to use this to your advantage in some situations. For example, if an employer has provided their apparent walkaway number or maximum offer and refuses to go beyond this figure, try negotiating around the other benefits the employer offers, like this:

“That salary offer is a little lower than I was expecting considering my experience and the value I could add to your company. Would you consider adding 25% additional vacation time or two remote workdays per week to account for the difference?”

This throws a curveball at the hiring manager. They will likely not be prepared for this type of bargaining. In most cases, they will need to refer to their superiors to determine whether they can negotiate a job candidate’s benefits. The hiring manager may offer a higher salary instead of accepting your counteroffer. The employer will then feel like they landed your employment at a great deal and you still walk away from the table with better compensation than anticipated.


Be Realistic and Don’t Get Greedy

As you begin researching in preparation for your salary negotiation, you might start feeling your confidence building. While it’s perfectly fine to feel excited about a new job prospect, it’s vital to be grounded in reality when it comes to making major life decisions such as accepting a new job. The research you conduct at the beginning of your preparation for your salary negotiation must include research into your own lifestyle and budget as well. Compare your current income to your budget and develop your financial goals. It’s vital to balance these goals with your expectations for accepting a new job, especially if it involves a longer commute time for moving to a new area.

While these factors may seem small, the reality is that changing employment to a place that’s farther from your home means more time spent on the road, more strain on your personal vehicle, and potentially less free time at home to account for the extra time you will need to prepare for work in the morning. Accepting a new job may seem to be in your best interests at first, but it is vital to ensure you do not become too focused on compensation and forget to account for your basic everyday needs.

On the other side of this is tempering your expectations when you’re confident that accepting a job offer is in your best interests. A job offer may require you to move, and the employer may offer some type of relocation incentive or signing bonus to encourage you to make the switch. This is likely standard procedure for the company, so do not assume it is a sign you can begin wringing as much as you can out of the hiring manager. Even if the employer is desperate to have someone like you on their team, you do not want to enter a new workplace with a reputation for being greedy and pushy.


Be Fearless

The key to how to negotiate salary is to be fearless without being overly confident. Temper your self-esteem with realistic expectations based on empirical data as you research the position you have been offered. Approach a salary negotiation with the goal of reaching a win-win scenario with the employer, but, remember, there are always other opportunities if this doesn’t work out for you. No matter what kind of turn your salary negotiation takes, do your best to maintain your poker face and don’t show the hiring manager that you are rattled by the prospect of negotiating your compensation package. Following the aforementioned tips will help guide you through your negotiations and hopefully lead you to landing an ideal compensation package for your new job.


Negotiation can be difficult, but there is both art and science behind good negotiations. Shapiro Negotiations is a world leader in business negotiation training, and we understand that many people may struggle when developing their personal negotiation strategies. Contact Shapiro Negotiations today for more information about the negotiation training programs we offer.


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