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Savvy Tips for Salary Negotiations
You’ve found “the one”—the candidate who has the skills, experience, passion, talent, work ethic and personality that will be a real asset to your company. Even better, the individual you’ve found is interested in the job. There’s just one thing that can bring it all to a screeching halt: salary negotiations.
While a lot of people don’t like talking about money—especially candidates who often feel they’re at a disadvantage or outnumbered—a significant part of the hiring process involves negotiating a fair salary. It’s a final hurdle that requires diplomacy and finesse. Done well, a successful negotiation ensures candidates feel valued and eager to begin their new position. Handled poorly, candidates can walk away feeling demoralized and uncertain about whether your company is really the right fit for them.
Here are some tips to guide you through the process as smoothly as possible.
- Start things off right.
It’s important to offer a fair salary up front—it speeds up the negotiation process and facilitates a better candidate-employer relationship. Your first offer should be a solid offer. How should you arrive at the figure for your initial offer? Research.You should know the average salary range for this position or similar ones in your industry—along with intel about what competitors typically pay. Also, know what your firm can afford to pay and what is out-of-bounds so no one is misled.
- Be prepared for counteroffers.
Not every candidate is going to be enthusiastic about your initial offer. Some may appear reluctant as a negotiating ploy. Others may be unsure the job is a good match and postpone their answer to buy a little time to research or mull over the offer. Others may simply be disappointed with the offer. Whatever the reason may be, counteroffers are common. In one survey, 100 percent of responding companies said it was reasonable for candidates to negotiate for more compensation, and at least 90 percent expected candidates to present a counter offer.Some candidates are skilled negotiators. A study by Carnegie Mellon showed that people who negotiated their starting salaries were able to increase them by 7.4 percent ($4,000 a year). Over the course of their careers, this salary bump earned them at least $1M more than individuals who didn’t negotiate. To accommodate a counteroffer, most companies do not offer their maximum starting salary amount up front in order to hold some funds in reserve for counteroffers.
If a candidate is looking for a larger salary, determine if their counteroffer aligns with their potential contribution and skills. Does the market demand for their skills align with the counteroffer? If so, you then need to take into account the pay scale for that particular job. If you accept their counteroffer, do you still have room to award annual raises? Does a change in title also need to be negotiated?
- When cash it tight, woo candidates with other perks.
What do you do if the candidate wants more time to think about your offer? Avoid ultimatums or the expectation of an immediate answer. Employers should give individuals at least one to two to think about an offer. However, more complex job offers may warrant more time for consideration—a week, perhaps. If a candidate asks for even more time, you may run the risk of stalling the hiring process. You’ll have to decide if the request is reasonable and whether you can afford to accommodate the request. If your candidate seems unable to make a decision or reconcile themselves to your offer, then it may be time to move on to your next best candidate.
- Let Snelling negotiate for you.
Want to skip the headaches and hassles associated with salary negotiations? As a trusted custom workforce solutions provider for more than 60 years, Snelling has helped countless companies not only find exceptional candidates for their business, but successfully navigate every aspects of the hiring process—including salary negotiations. Connect with one of our staffing experts today to see how we can serve you.