How to Negotiate Salary in a Rocky Economy

You don’t have to change your salary negotiation strategy during a recession. Do your research and advocate for yourself, but empathize with the company’s economic situation. Consider negotiating for other benefits like increased time off or a sign-on bonus if a salary increase is not possible.

By Lora Korpar

Negotiating a salary can be scary, especially when economic times are tough. How do you balance receiving the pay you deserve while not adding to the financial burden of a recession?

Experts predict a recession will hit the U.S. next year. Recessions include an employment rate reduction, so many worry that negotiating salary will risk their job security.

“If you are a 22-year-old college graduate taking your first job and the job pays 50,000, let’s say you get a 3% bump every year,” said salary negotiation coach Steve Hague. “The person who negotiated an extra 5% versus the person that doesn't do that and gets that same 3% bump every year, the difference by the time those two retire is [more than $200,000]. Just with that one simple negotiation being able to bump your salary when you take that first job and with every job that you take, you're going to see those [increases] over the course of your career.”

Companies might not be able to afford higher pay during a recession, but that shouldn’t discourage you from trying to negotiate.

“I don't really think [your salary negotiation strategy] should change that much at all during a recession,” said salary negotiation coach Kate Dixon. “I really think that a collaborative approach, advocating for yourself — those are things that you should do regardless of what's going on in the economy.”?

Determining Your Salary

The first step to negotiating a salary is determining the amount you’d like to negotiate for. Some states and cities are implementing transparency laws requiring employers to add salary ranges to job listings. Use the range as a guideline if it is available.

Use online resources to estimate the range if unavailable. Don’t forget to account for your location, experience level, and company. Salary offers might be lower than usual during a recession, but you will never receive a higher salary if you don’t try.

“Get familiar with what the market is for the kind of work that you do and look not only at the job title, but the responsibilities, and make sure that you're getting a good match,” Dixon said.

Speaking to people who already work with the company in similar positions can also help.

“I don't recommend that you ask people by saying, ‘Hey, how much do you make?’” Dixon said. “But approach them and say, ‘Hey, I've done some research and my research is showing that jobs like the one that you have range from X to Y. Does that resonate with you?’”

Top Tips for Negotiating During a Rocky Economy

Once you know the amount to negotiate for, the next step is asserting your worth.

“It's really about the value you add, or if you're out of work, the value that you can add,” Hague said. “That's really important for people to have as part of their discussion on compensation and just negotiation on a job offer. I tell people ‘You are the CEO and owner of You, Inc.’ So although lots of us work for a company when it comes down to it, we're really working for ourselves.

“Don't just think about now and the next few months or the next year. Try to plan out a long-term strategy. That's really up to you because the employer wants to get the best candidates, but they also want to get them at the best price.”

Never accept a salary offer on the spot. Ask for some time to review the job offer. This will provide emotional distance so you can be more objective during the negotiation.

“How much a company is willing to offer you is not about you as a person. It's about how much the company values the work that you do,” Dixon said. “It feels personal, but it really isn't. And if you can get a little bit of emotional distance from the process, you'll be more effective in your negotiation.”

What If the Negotiation Doesn’t Work

A salary is not the only aspect of a job offer to negotiate. If a company does not have the financial means to provide the salary you ask for during a recession, it might be able to provide something else instead.

“You can actually negotiate for a different title,” Hague said. “And that doesn't sound like much, but it makes you more marketable if you ever decide to leave the company that you're joining.”

Also, consider negotiating for a sign-on bonus or relocation cost coverage if you have to move to a new job. Or negotiate for extra paid time off.

Medical benefits are more tricky to negotiate because the insurance company determines what each plan covers. However, asking the hiring team to shorten the waiting period before benefits begin is another option if they won’t budge on salary.

Economic hardships don’t last forever. So if you have to take a salary you aren’t happy with, leave the door open for future negotiations when the economy improves.

“Just acknowledge to the recruiter or the hiring manager that ‘I understand we’re in a recession and it’s not great now… I'd be interested in having sort of a conversation on performance in six months to a year. When the economy starts doing better, I'd like for us to revisit this conversation.’”

(A version of this article first appeared on December 2, 2022, on the Get Hired by LinkedIn News page. You can read the full article, which was written and reported by Lora Korpar, by clicking here.)

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• Does negotiation strategy change during a recession? (By Brandi Fowler) Negotiating during a recession can be tricky, but shouldn't be tossed aside because of the economic climate. Instead, know your worth, show your value, and negotiate if the initial offer isn’t favorable no matter the circumstances. Read more by clicking here.?
• How do find common ground while negotiating?? (By Ciarra Maraj) The goal of a negotiation is to find common ground. Rather than feeling like an argument, a negotiation should be a two-sided conversation that focuses on overcoming "the barriers that stand in the way of what you both want to do," Ben Cook, CEO of negotiation firm RIVA HQ, told Forbes. To prepare, clarify your goals and use them as motivation to negotiate. Read the advice here.?
• Do you think your pay is fair? (By Gianna Prudente) Only 32% of employees feel they are being compensated fairly, with "organizational trust" driving their perceptions of pay, according to a new survey from Gartner Inc. "When employees don’t trust their employers, they don’t believe their pay is fair or equitable," says Gartner's Tony Guadagni. Lack of work-life balance, a non-inclusive culture and unfair experiences all chip away at organizational trust, the survey notes. Read more by clicking here.?

Negotiations are often nerve-wracking. However, they don’t have to be. The key is knowing your non-negotiables and when to walk away. This LinkedIn Learning course teaches you the best practices for negotiating. After all, you will not receive what you deserve without asking for it. You can watch the video below or by clicking here.?