This story is part of Power Money MovesCNET’s coverage of smart money decisions for today’s changing world.
It’s May 2022: The Great Resignation — now transitioning into the Great Reshuffle — is going strong, with more than 10 million jobs currently on the market. American companies are projecting an average salary increase of 3.4% for the year.
With inflation on the rise, the stock market slumping and employees quitting their jobs for more flexibility and higher pay, now is a great time to ask for a raise and negotiate your salary.
But successfully negotiating your next raise isnt just about the words you say to get a higher salary. That’s important, too, of course – but so is cultivating your relationships and doing some key groundwork to help seal the deal. I sat down with Alexandra Carter, Columbia Law professor and author of The Wall Street Journal bestseller, Ask For More: 10 Questions to Negotiate Anything, to dig deeper into setting yourself up for a raise in 2022.
Read more: ‘Hustle Culture’ Is Facing an Existential Crisis With Millennials
Know your value — including your replacement cost
When negotiating your salary, you want to emphasize the contributions you’ve made. Remind your manager of the value you bring to the table, like boosting productivity, increasing revenue, delivering on goals ahead of time.
Make sure you also review the salary data for your role. In the current climate, you should know you may already be saving your employer money by not leaving. That’s because it’s costly for companies to look for new talent, interview candidates and train new employees.
“Turnover is expensive, both in terms of time and money. An employee making $36,000 costs about $12,000 to replace — and if you’re making $150,000?” Carter said. “Your company will need to spend $50,000 finding your replacement and bringing them up to speed.”
It can be hard to enter salary negotiations without another job offer on the table, so if you know that sticking with your company saves them tens of thousands of dollars, it can be a powerful argument in your favor.
Time your negotiation for maximum effect
It’s always important to time your salary discussion right. One strategy is to take advantage of “high-leverage” moments — successes and victories you’ve delivered on behalf of your company — to share your compensation goals with your supervisor.
Remember, too, that most salary negotiations aren’t a single conversation. “Think of it as a political campaign,” Carter said. “If performance reviews are in March, you don’t start your campaign then. Put your ask on the table early, while the company is making budget decisions and allocating dollars for the coming fiscal year.”
Know that negotiation is a team sport
A key part of negotiating is gathering feedback from your allies and advocates. Prior to negotiation, make sure to meet with the people who know your work best, who will support you and provide you honest assessments of your goals. Think about it like you’re coordinating a campaign: Whose input and advice will help you achieve your objectives?
“Speak to people who might be allies and advocates for you, and request their advice on how to frame your ask to your manager,” Carter said. “This way, on decision day, if all goes according to plan, your manager will not only hear your case, but also “an ‘echo chamber’ of people saying how valuable you are.”
This also means you should be a team player and think about who you can support in their career goals. “When we support each other, it’s possible for all of us to get where we want to go,” Carter said.
Lead with open questions
Negotiations can be powerful when leading with open-ended questions, rather than arguments. In fact, you might get more money with this technique. In order to formulate your questions, make sure you’re aware of the company’s priorities, and that you thoroughly understand your manager’s goals, needs and concerns. Powerful open-ended questions often start with, “What,” “How,” or “Tell me…”
Some examples include:
- “What are your goals for our team/department/company this coming year?”
- “How can I best help in achieving those?”
- “What would a successful year look like for us?”
Consider your nonmonetary needs
A Harvard Business Review study of the recent wave of resignations suggests that, for many people, factors beyond money are just as important, if not more, to their overall career satisfaction. In fact, a report by Glassdoor shows that company culture and values, quality of senior leadership and career opportunities are the strongest predictors of employee satisfaction.
Carter suggests making a list of your career needs for 2022. “For some, compensation will be paramount. For others, flexibility is of the utmost importance.” Essentially, she says, determine what takes priority to help guide your approach. Before your negotiations, take time to think about the specifics of what you value the most, such as:
- Boundaries: Arguably the most important request is to negotiate your boundaries. Especially in light of the burnout brought on by the last two years of the pandemic, establishing clear boundaries regarding work hours and the scope of your work will allow you to construct a career that is sustainable.
- Access: Think about the tools, information and resources you need to access to perform at your highest levels. Negotiating for access will affect your workplace day-to-day, allowing you to gain autonomy and confidence within your organization.
- Support: You can and should negotiate with your workplace to ensure you have the support and resources you need to be successful within your job, from professional organizations or additional schooling. For example, Carter suggests that women negotiate for their companies to pay for membership to organizations that support and connect female professionals — such as Luminary in New York City or CREW network — to access women-centric spaces that will allow them to be equipped and supported as leaders.
Round out your negotiations with a powerful question
Finally, Carter advocates concluding your negotiation by asking one final question that encapsulates your salary goal. This question needs to be an open question, not a query easily answered by a yes or a no — because the easy answer is, “No.”
So, avoid asking questions like, “Can we raise my salary?” or “Are there salary increases built into the budget?”
Instead, opt for open questions that recruit your company’s participation in helping you achieve a raise, and establishes that you and your manager are both on the same team. This might mean asking, “What do we need to show to make the case for a 20% raise?” or “How can we make my compensation reflect the value I’m bringing on our biggest institutional priority?”
This can help you find out what your company is looking for in order to promote you or pay you more money, and gives you a clearer roadmap to follow to achieve a raise during your next review.
“When you ask powerful questions, you negotiate from a place of strength as well as collaboration — which increases the odds that you’ll be ending 2022 with more money in your pocket.”
What if your raise negotiations are unsuccessful?
If your negotiations don’t net you a raise, Carter advises asking questions that can generate concrete, helpful answers from your manager. Some examples include:
- What was the concern?
- Why wasn’t this possible?
- What can we do between now and the next promotion cycle to change this outcome?
- How can I help you make my case?
Getting actionable answers to these questions can help you uncover what skills you need to work on. You may even discover that a raise is in your near future, just not the current moment.
However, if you’re receiving vague answers like “Hang in there!” or “It’ll come soon!” consider turning your eye to other career options and creating your own opportunities, After all, the job market is booming and an outside offer could help your current company see your full value — it also gives you the upper hand when negotiating.
If your negotiations are successful, be sure to revisit your retirement savings strategy and consider adding more money each paycheck to employer-match plans. You may also want to explore other investment opportunities to help grow your moneywhile planning for your future.
