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Looking for new opportunities? The Great Resignation has workers on the move, and this could be your moment to land a better job with better compensation. To remain competitive, many employers are offering compensation packages that include a wider range of benefits such as higher pay, signing bonuses, tuition reimbursement and more.
You can negotiate the right salary package by researching salary trends, factoring in the value of benefits and sizing up lifestyle and growth potential before you sign on. Don't be afraid to ask for more: A better salary package now lays the groundwork for your future income.
Get Salary Data
According to The Conference Board, a membership and research organization for large companies, executives project salary increases of nearly 4% for 2022—the largest increase since 2008. In a rising wage market, the challenge is to make sure your salary meter keeps pace (or beats it). You can start with your current salary as a benchmark, but look further if you want to get a sense of what the market will bear.
Here are a few steps for gathering information:
Confirm Your Current Salary
To compare the salary you've been offered with your current salary, you need to know exactly how much you make. As odd as it sounds, it's easy to lose track of your exact salary after it's been adjusted over the years. To find out what you're paid annually, grab your paycheck and multiply the gross wages by:
- 12 if you're paid monthly
- 24 if you're paid twice a month
- 26 if you're paid every two weeks
- 52 if you're paid every week
Seek Out Objective Information
Knowing how your current or proposed salary stacks up is a second critical piece of the puzzle. External salary data can give you additional insight. Industry associations are one source for this kind of information. You can also access salary data from sites like Salary.com, Glassdoor or Payscale, which aggregate data to provide a range of salaries for your job title, experience level and location.
Ask Colleagues for an Opinion
Do you have friends in the industry or belong to an informal networking group? Although many people are uncomfortable disclosing their salary, some may be willing to share information. If not, try floating a job description and asking what colleagues might expect to pay or be paid for the position.
Talk to Recruiters
Recruiters have a frontline view of what employers are paying and how salaries are changing minute by minute. A recruiter may be able to help you ballpark a range of potential salaries based on your experience and job description.
Defend Your Bottom Line
Once you have a sense of what you expect to earn, compare your findings with the salary being offered. If the offer falls short, be prepared to counter. The salary you negotiate now will be the basis for future raises and promotions, so even a modest increase in your starting salary can pay off substantially over time. You may decide to be flexible on salary, however, if other factors like benefits or growth potential are in your favor.
Add Up the Value of Benefits
Employee benefits can range from bare bones to elaborate. Among the benefits you may find in the current job market are:
- Health insurance
- Dental and vision coverage
- Mental health coverage or an employee assistance program
- Elder care coverage
- Pet insurance
- Flexible spending or health savings accounts, with or without employer funding
- Retirement, with or without employer matching
- Paid family leave
- Vacation days, paid holidays and paid time off
- Paid sabbaticals
- Bonuses and commissions
- Paid education opportunities
- Signing bonuses
- Stock options
The Bureau of Labor Statistics reports that employee benefits account for about 30% of compensation at private firms. If you want to understand the true value of a job offer, you need to factor in the value of your benefits. This includes both the subjective value you place on benefits as well as a dollar value, if possible. Start with these steps:
Prioritize Benefits Based on Your Needs
Every benefit isn't equally important to you. For example, if you hope to have a child in the next two years, 12 weeks of paid family leave might be very valuable. If you're planning to remain child-free, on the other hand, that same benefit is worthless to you. A similar sliding scale might apply to generous dental benefits, a relocation allowance, stock options or employer-matched retirement contributions. Also consider the quality of benefits: A fully paid healthcare plan with a low deductible is worth more than a high-deductible plan you partially pay for from your own pocket.
Assign Benefits a Dollar Value
Where you can, estimate a difference in dollars between the benefits you have at your current job and the benefits at your prospective job. If you earn $84,000 a year, 12 weeks of paid parental leave are worth more than $19,000. Do you contribute $10,000 a year to your 401(k)? A 100% employer match is worth $7,500 a year more than a 25% match. Leaving behind a paid gym membership at your old job? Subtract $75 a month from your salary offer.
Factoring the value of benefits into your evaluation can help you make an apples-to-apples comparison that results in a more informed decision. Benefits can significantly boost your overall compensation, especially when you receive benefits you genuinely want and need. Alternatively, having to cover the cost of missing benefits out of pocket will mean having to stretch your salary further.
Consider Quality of Life Factors
When considering a job offer, think about the value work-life factors have for you. For example, the ability to work remotely is one of the most sought-after perks among job seekers today. Maybe being able to work remotely tips the balance since it allows you to pick up kids after school or save a few dollars on dry cleaning. Alternatively, a great office location or a congenial team atmosphere might better suit your personality and work goals, tipping the balance in the other direction.
You could also try to assign a dollar value to work-life benefits. A short commute saves you money on gas or train fare. A new job in a less expensive location could reduce your housing costs. Bringing your dog to work could save you $50 a day—or more than $1,000 a month—on doggie daycare.
Measure Your Potential for Growth
In addition to sizing up what your new job pays now, consider what your growth potential might be in the years to come. This can be tricky to assess, but some factors are good indicators for potential growth. A thriving company is likely to have more opportunities than a company in decline will, so pay attention to the company's health. A new boss who could be a champion for you is another plus, putting you in line for interesting projects, promotions or raises. Additionally, think about whether your new employer is structurally prepared to help you advance your career. A few things to look for:
- Continuing education and training
- Tuition reimbursement
- Networking opportunities
- Leadership development
- Diversity, equity and inclusion programs
Carefully Review Your Job Offer
Fully understanding a job offer requires more than a peek at your new salary. Analyzing the value of benefits, accounting for work-life factors and taking stock of growth potential can provide a more rounded picture of whether or not a new job is for you. In a job-seeker's market, negotiating for additional salary, a remote work arrangement or a signing bonus is certainly worth trying. Then again, if you find a job you love that's willing to compensate you fairly and help you grow, a little flexibility doesn't hurt either. Knowing your bottom line—and what a job offer is really worth—helps you make a wise decision.