July 11, 2010

Return to earn: How to make the most of salary negotiations after unemployment

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It’s important to know your bottom line in negotiations for pay. (Thinkstock)

Close to a job offer? If you’ve been unemployed for several months or longer, you are likely at a disadvantage in negotiating salary. Still, knowing the rules of the game can help you navigate a competitive compensation package.

“Whether out of work or not, don’t talk about the compensation until you’ve been offered the position,” says Joan Ciferri, president of David Wood Personnel. “Don’t behave like you’re more interested in the package than the job.”

Ciferri recommends getting the interviewer to tip his or her hand first on the salary budget.

“Find out what range they have for the position,” she says. “If they ask you what compensation you’re looking for, turn it back on them: ‘What range do you have budgeted for the position?’ Once you have that information, you can negotiate.”

Generally, unemployed job candidates in the recession have been offered less than or equal to what they were making in a previous job. One strategy is to offer your services for 90 percent of the midpoint in the pay range, says Barry Brown, president of Effective Resources, a consulting firm that annually surveys employers in Florida about pay rates. Most employers have not updated their pay ranges for two years.

“Ask an employer when the last time the pay range was updated,” Brown says. If you are more experienced, you may want to ask for at least 95 percent of the midpoint, he says.

Joe LoBello, managing director of staffing firm Stephen James Associates, says what matters is the market value for the job. If an employer has identified a group of qualified candidates who were all making $75,000 a year in a similar position, “that’s the new market value.”

Ciferri says even if desperate to take a job, unemployed workers have to know their bottom lines — what is needed to pay the bills. Still, “never say ‘no’ or end the conversation on a negative tone,” she says.

Besides salary, there may be other forms of compensation including bonuses, health insurance premiums, subsidized child care services, a company match on your retirement savings, and extra mileage reimbursement or a gas card if you commute. Executives can ask for profit-sharing and equity to improve their compensation down the road.

“Don’t ask for a sign-on bonus,” LoBello says. That went the way of relocation expenses for many in the recession. Job candidates may ask for a tradeoff, such as an extra week of vacation, sponsorship for professional training or educational reimbursement, he says.

There’s also a case for being somewhere “in the middle” in salary during changing economic times, Ciferri says. “Businesses are not making what they used to make and have had to cut staff. ... You don’t want to go so far off the scale that you’re the first one to go.”

Brown counsels employers not to take too much advantage when hiring workers during the recession: “They will be the first people to leave when things turn around.”

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Resumes and Job Hunt, featured, interviewing, negotiating

1 Comments

OverQualified and NotEmployed on July 13, 2010 10:09 PM | Reply

HAH. I wish I could get anything CLOSE to 75k a year. That would be a rather large paycut, but it would still pay my bills. The rates are now closer to 45k. Which is less than I made 12 years ago, with only 6 years experience in the field, not the 18 I have now.

Too bad I can't use the economy as an excuse to pay less on my bills the way employers are using it to slash wages to ridiculously low levels.

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