Even in soft job market, it pays to negotiate salary

Survey finds that 45 percent of Employers expect it, but nearly half of workers take first offer

Chicago TribuneSeptember 8, 2013 

When you took your latest job, did you negotiate for more pay?

If not, you might have left money on the table. And that's an error few can afford to make in this period of anemic pay growth.

Since the Great Recession, pay has been going up at a snail's pace. In fact, according to the Economic Policy Institute, wages fell for the bottom 70 percent of workers from 2007 to 2012. And the period up to that point wasn't particularly helpful for pay, either.

Research by Lawrence Mishel and Heidi Shierholz for the institute shows that from 2000 to 2007 the median worker's wage growth was just 2.6 percent. People at the higher rungs of compensation did better, but even there, gains were sluggish.

From 2007 to 2012 "white-collar occupations, blue-collar and service job compensation remained unchanged for managers and professionals, while it declined 2.2 percent for sales jobs," the researchers said. "The vast majority of wage earners have already experienced a lost decade, one where real wages were either flat or in decline."

With such a lousy environment for pay, and with the unemployment rate still at recessionary levels, many people have concluded they are simply lucky to have a job. They fear that asking for more money could be a dangerous move when applicants far outnumber openings.

Yet a new survey by CareerBuilder, a Tribune Co. affiliate, suggests there might be more room to negotiate for pay than people assume.

About 45 percent of employers said they are willing to negotiate salaries for initial job offers. And they expect job applicants to try to negotiate pay.

In contrast, 49 percent of workers said they accept the first offer.

The survey was done online by Harris Interactive and involved 2,000 hiring managers and human resource professionals and about 3,000 full-time private-sector U.S. workers.

The research shows that people are more daring with age. About 55 percent of workers 35 and older said they negotiate the first offer. Only 45 percent of those 18 to 34 did so.

Men are more willing to talk money. About 54 percent of men said they negotiated, while only 49 percent of women did. That may be one reason that a pay gap exists between men and women in the same types of jobs.

Research of recent college graduates done last year by the American Association of University Women showed men averaging more pay than women in virtually all professions. For example, after majoring in business, women were earning about $38,000 on average, while men at the same stage of careers were earning $45,000.

"Many employers expect a salary negotiation and build that into their initial offer," said Rosemary Haefner, vice president of human resources at CareerBuilder. "So when job seekers take the first number given them, they are oftentimes undervaluing their market worth."

Some hiring managers will not have the leeway to raise the offer, "but it's never a bad idea to negotiate, especially if you have experience and possess in-demand technical skills," Haefner said.

The most likely workers to negotiate are those applying for professional and business services jobs, the survey shows. About 56 percent of them negotiate, compared to 55 percent in information technology and leisure and hospitality and 54 percent in sales.

If hiring managers can't meet salary requirements, a majority will sweeten benefits, the survey shows. About 33 percent will offer a flexible schedule, 19 percent will grant more vacation, 15 percent will let an employee telecommute at least once a week, and 14 percent will pay for a mobile phone.

During the next year, about 54 percent of the hiring managers and human resource professionals said they will be open to negotiating salaries on initial job offers.

Gail MarksJarvis is a personal finance columnist for the Chicago Tribune and author of Saving for Retirement Without Living Like a Pauper or Winning the Lottery. Readers may send her email at gmarksjarvistribune.com.

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