Should You Lower Your Salary Expectations?

salary-expectationsHow to tell if you're being realistic about what you should be earning

Everyone is pinching pennies these days, including employers. Hiring freezes, lower salary offers to new hires and smaller raises for existing employees have become commonplace. The unfortunate effect of all of this, is that many workers will have to accept -- or at least consider accepting -- lower salaries than in the past. Still, taking a pay cut is a big deal. So how do you decide whether lowering you salary expectations will be beneficial to your job search or just a hindrance to achieving what you're really worth?

Unfortunately, the answer isn't clear cut, says Cheryl Palmer, a career coach and owner of Call To Career. "Many job seekers do not know what the market will bear, and as a result their expectations are out of sync," she says. "Some people arbitrarily decide that they will not take anything less than the salary that they made before being laid off. Others read or watch the news reports of the bad job market and decide that anything is better than nothing. Both of these approaches can lead to poor decision making because they are based on incomplete information."

-- What should your job pay? Compare your salary.

In order to make an informed decision on whether or not your salary expectations are reasonable you must first research your industry and the salaries of others in comparable positions. "It is imperative that job seekers research salary information so that they know what is reasonable to expect for someone with their level of experience in the geographic location where they are looking for work, " Palmer says. Websites like CBSalary.com can provide information on average starting salaries for hundreds of different industries and positions. By finding out what the going rate is for skills like yours, you can be sure you're asking price is in line with that of your peers.

Your salary research will shed light on your job search in one of two ways. If you find that you are earning wages in line with others in your field, there is no need to make an adjustment. Asking for a salary below the industry average will not necessarily give you a competitive edge, and may in fact be a hindrance to getting hired; If your salary timeline shows a history of making more money than you are asking an employer for, the company may be afraid you will bolt as soon as a better offer comes along. As long as you're asking for a reasonable salary that is in line with the going rate for your position, there is no need to lowball yourself.

On the other hand, you may find out you are shooting too high: "If the median salary range in your region of the country and position is $75,000 to $85,000 and you have expectations of six-figure earnings, you will be disappointed," says J.T. Kirk, author of "Confessions of a Hiring Manager." If you find that you are making more than 20 percent above the industry average, you may want to reevaluate your asking price.

If you do find yourself in the latter category, the following factors should be considered before deciding to lower your salary requirement -- and by how much.


1. Urgency

"If there's less pressure to find something immediately, then [the jobseeker] may be able to stick closer to their ideal salary expectation, it just may take longer to find something," says Greg Masiewich of IQ Partners, a Canadian recruiting firm. "If someone needs [a job] immediately, then often lowering salary expectations will help them do that."


2. Competition

"An industry where there is a ton of competition and candidates are plentiful may result in people needing to lower salary expectations. If they're in a specialized industry where their skills are still in high demand, then they may not have to ... it comes back to supply and demand," Masiewich says.

-- Is it time to negotiate a raise? Check your salary health.


3. Benefits

Consider what extras -- like an excellent 401k plan, flexible scheduling or a family-friendly corporate culture -- are worth to you. Benefits can make up for a smaller salary.


4. Negotiation

"If someone does have to accept a lower level position or take a pay cut, I think they should try and negotiate an offer that contains some sort of pay for performance provision," advises Linda Duffy, president of Leadership Habitude. "If they can show the prospective employer their added value and help the employer achieve some specific goals, then they would receive a bonus or bump in base pay on a date certain. Not all companies are willing to make that deal, but it doesn't hurt to ask."

Additionally, if you have special skills, an advanced degree or experience at a name brand company, you may be able to negotiate a higher salary than those who don't.


5. Your bottom line

Although you may be willing to take a pay cut in order to get a new job, it's important to figure out your bottom line -- what you need to make in order to pay your bills and live comfortably -- before accepting a lower salary. If you accept too little money, you may find yourself unable to make ends meet or resentful of your low-pay, and you'll wind up looking for a new job all over again.

Ultimately, taking a pay cut is tough, and the decision to do so depends heavily on personal situation. Doing your research, figuring out your bottom line, and keeping an open mind will help you best determine your optimum salary.

Next: High CEO Salaries Raise More Than Eyebrows >>


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kevin

Its all a matter of supply and demand. You can easily be replaced especially in this economy. During the great depression, workers didn't say boo to their bosses. If they did they were easily replaced cause there was a line of people waiting for the job. Not horribly different from today.

August 18 2010 at 2:40 PM Report abuse rate up rate down Reply
Casualyurs

First off.. I will NEVER EVER, EVER move from one job to the next without any type of salary increase. I always go up... NEVER Down or Sideways. I don't care what state the economy is in. If I'm unemployed.. that's a completely different story however, at the same time, Companies are absolutely "STUPID" to hire someone at a minimal salary when they are unemployed, because the first chance that new employee has to get a higher pay from another Company.. that employee is going to walk. "DUMB" on the Company's part. Also rotten on the Company's part for taking advantage of the person who is unemployed. A person should be paid whatever they are worth, based on experience, knowledge.... etc. Oh.. one more thing.. you Companies that like to hire people with college degrees over the folks without one for a job where there is no degree offered by any University/School in the Country.. you're "STUPID" also.. because what you end up getting is someone with no experience whatsoever at a cheap salary, and in certain areas that will end up costing you HUGE $$$... so Wise Up!!!! I work for a company that pays a salary, and they also pay reasonable bonuses in a yearly basis. I take my bonuses and average them into my yearly income. If I'm looking for another job somewhere else... I make sure I tap companies that I know pay bonuses as well.. but quote them my current "Average" yearly income, and not my base salary and what my bonus generally is. I also explain that to them so they know I'm honest, but explain that I'm looking for that average yearly income number as a base salary. This way not matter what happens, you're at least earning a higher salary, and you've managed to get yourself a raise moving from one job to the next, then when you're new company pays the bonuses, now your average yearly income has significantly increased, and the worst case scenario is that if the company is not doing well and can't pay bonuses.. at least you've got your old average yearly income. The only difference is you're seeing that increase in every pay check.

People.. don't be stupid. Don't allow these corporations to get over on you. Use your head, and don't feel that you're at a disadvantage all the time. That's exactly how they want you to feel. Also.. once you're employed.... whatever you do... DO NOT CONFORM TO THE NORM and become a "Yes" person. That's how these companies enslave you. It's basically "Legalized" Slavery. Think about it for a while. Think about how a company manages to push it's way into your personal life. If you have children.... you're hurting them whenever you're emailing on a Saturday... or up to 9/10pm in the evening during the week. You work from 9 to 5. Leave it at that. If you feel the need to do work outside of that.. but for your own satisfaction.. not because you feel obligated.. then by all means do it. But think of your mental health, and your family. Those of you who are married.... trust me... unless you're both working and give up your personal lives... (which is dumb because, what kind of marriage can you have like that).... you spouse will eventually get pretty disgusted with you not being there as the partner/parent. That causes divorce sometimes.

Anyway.. "GET A LIFE"..... lol Just don't conform to the norm.

Casualyurs

August 18 2010 at 2:14 PM Report abuse rate up rate down Reply
steelartist

Pay cuts need to start at the top, starting with CEO's who have been rewarded for outsourcing millions of Americans jobs. Next, upper management who usually spend their days hitting on the women in the office, then useless supervisors who spend most of the day shopping online, looking at porn or reading the newspapers. Unfortunately in our capitalist country the more worthless someone is the higher the pay, and the few who do earn a living gets screwed.

August 18 2010 at 2:07 PM Report abuse rate up rate down Reply
kenhp1

Did that sex addict from hewlett-packard give all those millions back. Most employees would have been booted without a dime. All for the big guys, no matter how corrupt they are.
These CEO's get fired, collect millions in severence or whatever to get them out the door. It is disgusting to me.
This structure needs to crumble. Employees need to somehow have a bigger say in how they are compensated, their working conditions, and other aspects of their employment. I don't know if unions are the way to go.
The board should include people that work at the bottom and upward to maintain the integrity of the workplace. Until that happens the rich will get richer and the poor will suffer more economic harm.
If there had been employees on the board at hewlett-packard maybe this slimball wouldn't have walked away with millions. It could have gone to a fund to help the children of the employees go to college. A much better use of the money.

August 18 2010 at 1:11 PM Report abuse rate up rate down Reply
jaba

DO MANAGEMENT AND CEO'S LOWER "THEIR" SALARY EXPECTATIONS? I SHOULD SAY 'NOT'!

August 18 2010 at 12:54 PM Report abuse rate up rate down Reply
TED

The author is dreaming. It is an employers market. Very few will increase their offer to meet the applicants demand. Beside that, many workers are making more than the job is worth brcause the worker is is only putting forth about 60% effort. The recession has shown that companies can function efficiently with less staff.

August 18 2010 at 12:35 PM Report abuse rate up rate down Reply
bobbycamacho

The government has created this problem to their advantage, when companies are being bailed out or for that matter TOO BIG to FAIL, that leaves the government in control of the distribution of wealth.

This is the time that many large and small business are taking advantage in this flooded market of people that are unemployed. Can we say Supply and Demand?

And don't forget, lets keep printing more money and create more national debt, this will keep all investers away from America.

August 18 2010 at 12:11 PM Report abuse rate up rate down Reply
Joseph Bertola

Sure lower our pay! So we will not be able to have 3 square's a day. The pay is NOT the problem, it is what the vendors are charging that is the problem. Go ahead lower the pay, but lower the f@#$ing cost of things that the consumer's are or have to buy. This whole system is wrong because it is ALL WAYS the rich get a the poor get f&^%ed

August 18 2010 at 10:43 AM Report abuse rate up rate down Reply
delaware

TAKE APAY CUT YOU ASK ??? AS GROCERIES, GASOLINE,MEDICAL,INSURANCE,S ,UTILITY BILLS,LOCAL TAXES, STATE TAXES KEEP CLIMBING...AND YOU ASK ONE IF THEY WOULD CONSIDER APAY CUT NEGOTION...YOU MUST BE ON DRUGS OR AT ACOMPLETE LOST OF TOUCH WITH THE REAL WORLD OUT HERE ???

August 18 2010 at 10:35 AM Report abuse rate up rate down Reply
Robin Hood

We would not be discussing this if we were in a free market economy. This is the first shot to transition this country to a monarchy type of government. The rich are your lords and princes. Divide and concour is the GOP mantra. They have successfully divided, now they are smashing the working class and increasing the divide between the haves and have nots. Any time in world history this happens, the goverment collapeses. The economy falls and civil unrest causes the split nation to reorganize under a new system. Russia, WWII Germany and on down the line. If they continue with this campaign to push the middle class down, they will destroy our Capitalist Economy. Capitalism is simply a tool for the few to take advantage of the rest!

August 18 2010 at 10:25 AM Report abuse rate up rate down Reply
1 reply to Robin Hood's comment
Badandyjax

We were in a free market economy before the loony leftist started injecting your socialist take over of the American people. I never got a job from a poor person but the rich are the ones who put there money at risk so they can venture out and create new businesses and jobs only to have democrats come and take it all away so they can give it out to people that will keep them in office thus keeping the little man down so he will only keep voting for the very people that only care about a vote as opposed to a nation of free people that drive the this country.

August 18 2010 at 12:11 PM Report abuse rate up rate down Reply

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