Want to earn what you are worth? Learn to negotiate

Now that I mentor younger female engineers and students, I think about what I would have done differently if I had known then what I know now. One piece of advice I wish I’d had when I was starting out is to negotiate your salary.  When I went after my first job it never really dawned on me to do so.  I, like most women, was just excited to get an offer.  Later in my career I read “Women Don’t Ask” by  Linda Babcock and Sara Laschever and learned that most men negotiate their salary from their very first job offer.  However, most women do not. Now I cringe when I think about how much money I probably left on the bargaining table back then.

Studies show that women typically get paid less than men.  This is likely caused by a number of factors, but the fact that women don’t step up to push for what they deserve surely contributes to the problem.  Many feel that if they do a good job, they will be rewarded.  I can tell you from my experience that you have to actively campaign to show your worth and get the rewards you deserve.  Your boss does not get paid to be your advocate.

From the financial side, it is well worth the effort to negotiate your salary.  Money-savvy blogger Ramit Sethi from I Will Teach You to Be Rich points out how much financial bang for the buck you get from negotiating your salary just one time.  Rather than wasting time following the “latte factor” advice of denying yourself  every day to save a few dollars, one salary negotiation early in your career could boost your income thousands of dollars a year.  In “Women Don’t Ask”, the authors provide an example of how a $5k difference in salary at age 22 can add up to over $350k in missed earnings by age 60. 1

So once you are convinced that you should negotiate your salary, how do you do it?  This is where you absolutely need to do your homework ahead of time.

  • Find out the market rate for your position – You can check websites like salary.com, salaryexpert.com, or check with local trade groups (for example, the IEEE collects salary statistics for electrical engineering positions).  Bring this information to your negotiation to back up your claims
  • Be prepared to tell why you deserve the salary – If you are asking for a raise, point out what successes you recently had that justify your increase.  Don’t tell your employer that you need the money for some personal reason (to pay off a college debt) – they don’t care about that.  They need to see your value to the company
  • Know your “BATNA” (Best Alternative to a Negotiated Agreement) – What happens if you don’t come to an agreement?  Do you have another job offer in the wings or a recruiter interested in working with you?  Having other options can give you a point of strength in salary negotiations, especially if you are negotiating for a new job.
  • Know the company’s BATNA – What does the company lose if you don’t come to an agreement?  Can they easily find someone else with the right skills?  If your skill set is difficult to find, you have an upper hand at the negotiating table.
  • Decide on your numbers – Have an exact figure for the your desired salary and also the minimum you will accept before you approach the bargaining table.  Having these determined ahead of time will keep you from making a split-second decision you will regret.  You also want to have the number in mind for where you want to start the negotiations (this should be higher than your goal) so you have room to negotiate when the other side counters.

Negotiating can be difficult, even when you believe you have the advantage.  Women often find their confidence crumbling after they get to the bargaining table.  To best prepare, practice with a friend first or, better yet, attend a workshop on the subject.  If you want to learn more about women and negotiation, check out the following books:

Whether you are just starting out or are in the middle of your career, you need to be your own advocate.  No one is going to look out for your interests better than you!

1 Babcock, L. & Laschever, S. (2008).  Ask For It: How Women Can Use the Power of Negotiation to Get What They Really Want. New York, New York: Bantam.