Hirers, Here Are 5 Tips To Negotiate Salaries Effectively
When looking for the right career path, jobseekers have a number of factors to consider. From mental health programs to proper work-life balance, each jobseeker’s priority list differs.
However, JobStreet’s Decoding Global Talent Report details a list of the top 10 most common. The report shares that financial compensation ranks #4 of 10 in a candidate’s job preference rundown. This section refers to the monetary benefits that a jobseeker can receive. As such, that specific benefit excludes the non-monetary side.
As an employer, you know that the salary negotiation part is a crucial step in the job search process. But did you know that you can negotiate a salary too? We share five tips in this article. Before we get to that, let us first break down why it is important to go about that.
Salary negotiation: Why is it important?
Salary.com shares that 84% of employers expect negotiations to come about during the recruitment process. While you have a set budget for each employee position, undergoing this has a purpose.
When doing the negotiation process, you have three questions you want to answer:
Is this employee worth it?
Do they have other job offers lined up?
Will the negotiated salary be in line with the budget you have set?
To prepare you for such scenarios, it is best to look at the competitive salary. This refers to the benchmark that employers look at for a specific position within the industry. Becoming aware of this figure can greatly help in figuring out how to provide an offer to your potential talent.
How do you effectively negotiate salary?
To reach a mutually beneficial agreement, make sure to plan out how you want the discussion to unfold. While you cannot set everything you wish in stone, it is best to prepare ahead. Here are five tips you can take into consideration:
Research industry standards
A competitive salary is just one of them. You also have to get to know what employees consider important when looking for a job. This could be vacation leaves, work-life balance, and the like. Now, you may ask – won’t these be covered in another part of the recruitment process? But consider this: knowing what jobseekers want could help you determine what sets your company apart from others. More importantly, what makes you attractive to potential talent. Keep in mind that jobseekers have a mental comparison sheet of different companies and their offers. Be one step ahead by getting to know what your competitors have – and what you can do to take it a step further. Ultimately, your goal is to retain talent.
Evaluate what you have to offer
Juxtapose to a jobseeker’s detailed list of skills and experience, you need to assess what your job offer is. With the industry statistics and the job description in tow, ask yourself the following questions:
When negotiating, remember that you are striking the balance between two things. These are what is fair to the candidate and to the company. While you have to ultimately stay within budget limits, challenge the status quo if the jobseeker is worth a higher salary. Ultimately, the goal is to fairly compensate the jobseeker based on qualifications and experience.
Is the compensation in line with what we require for the position
Are the benefits sufficient for the employee?
Is the compensation competitive enough in the market?
Set expectations at the beginning of the meeting
You and the jobseeker have agreed to finally talk about it. During the scheduled period, lay your cards on the table. While it is important to listen, setting the scene can help manage your jobseeker’s expectations. Begin by stating a specific monetary amount. Also known as anchoring, this refers to setting the baseline for the position. This is helpful especially since this gives you the upper hand. Make sure this figure falls in line with the salary range you have in mind. Asking them what they wish to have first may end up dissuading them afterwards. Such is true especially if the salary they expect does not fit your budget at all. Since the salary negotiation comes after the sharing of the benefits, this is where you can finish strong. You can defend your price and include the non-monetary benefits that make such worthy. These include the number of leaves you have, healthcare perks, and the like.
Listen to your candidate
While you have set expectations already, make sure to share the stage with your jobseeker. Treat your candidate as both an investment and an opportunity to learn more. Remember that the price you put out is your perception of their worth to your company. When the jobseeker speaks, make sure that you pay attention. There are certain details worth noting. These include their expected salary and the skills/experience that come with it. Aside from keeping track of the things they share, understand what they consider important. In line with this, candidates have a list of what they prefer in a job. It is up to you to share if they can offer that or not. More importantly, what are the benefits you can offer that are unique to your company? And do those said factors give you an edge or not? Like your regular employees, jobseekers wish to be heard. This includes sharing with you what their worth is and how what figure best determines that.
At the peak of the negotiation, you have laid your figures out. You have shared what the company can offer. On the other hand, the jobseeker stated their worth in financial compensation. The ball is now in your court. What do you do? Make sure to be transparent and upfront if your company can take it on. If you can, that is good. But if you cannot, mull over if the person is worth upping the salary range or not. The most important thing is never to give more than what you can. This can lead to mismanaged expectations and can burn more bridges than you would like. Ultimately, a professional appreciates honesty over grand recruitment gestures.
People instead of profit
Congratulations! You did it. You just went through a negotiation process. If this is your first time, you may wonder what happens next. After you share the offer, the next thing to do is wait. Give them space to have a think about the discussion and the salary.
But know that this process is a good application of a valuable lesson. Look at people first, then the numbers will follow. Financial compensation is a critical aspect. But it is only one of many determinants that equal how a professional’s value is in the workplace.
Acknowledging this is the first step. But applying that through a very good negotiation and offer can take you a long way. Most of all, your future employee will thank you for this experience.
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