How to negotiate starting salary when you're a new graduate
Warren Frehse
The Career Strategist for Professionals | Author | Multi-Sector Expertise | Actionable Insights for Growth and Transition | MAPS | PCDAA
IT'S a sad fact that many new graduates have no idea how to talk salary packaging.
Indeed, many are even unaware that they can.
Consequently, some employers take advantage of this situation and many graduates find their conditions of employment are far from what they expected.
The below table summarizes research from U.S. financial firm, NerdWallet, and shows that 62 per cent of new graduates are not negotiating their worth, while 74 per cent of employers admit to being able to increase their offer by 5 - 10 per cent during the initial stage.
So what can a new graduate negotiate when they have little to no negotiating power?
Well, surprisingly, there are a number of key areas a new graduate can negotiate, and it's not all about salary. Here are five to consider.
Know your worth in the graduate jobs market
Before you talk salary negotiations, it’s important to research what your role and skills are currently worth in the broader graduate market.
Website gradaustralia.com.au has lots of good information, and the professional associations in areas such as accounting and finance, engineering, information technology, and human resources are worth checking as they typically collect lots of data on starting salaries in their professions.
The more evidence you have to prove your worth, the better position you’ll be in to secure the salary you deserve.
Know when you are able to negotiate
According to Russell Johnson, pioneer of executive career transition services in Australia, and founder of Russell Johnson & Associates, many job candidates fail to establish the most effective mindset – that of a buyer, not a seller.
"Position yourself for success through building your unique personal brand," he says. That way, you go into the negotiation process with a clear view of what you can offer, and be confident that you have what it takes to get their attention.
Never attempt to negotiate until the employer actually wants you. That way, the negotiation scales are tipped in your favour.
“Money was never a big motivation for me, except as a way to keep score. The real excitement is playing the game.” ― Donald J. Trump, U.S. President, and author of Trump: The Art of the Deal
You have to wait until you actually hear the words - "We want to offer you the job" - then after the internal glow has subsided, you can begin the process.
Ensure you have a clear offer made to you. Ask:
- Does your total salary figure include superannuation or is superannuation paid in addition to the salary figure offered?
- What is the probation period and how will your performance be assessed during this time?
Know what you can negotiate
According to Robert Half, an executive search and recruitment firm, employers can offer more benefits than just the salary.
Many new graduates are often unaware that there are a number of other non-salary areas up for negotiation, and many are willing to give you some or all of these.
Negotiating a better overall conditions and benefits package, for example, can include further study tuition or professional development reimbursement, working from home time and telecommuting options, more superannuation, travel fares, professional membership fees reimbursements, or free car parking space, may be reasons to accept a smaller salary.
Know that what you both agreed on has to be in writing in the offer
Many new graduates assume that what was agreed to in the verbal negotiations will hold water when you start the job.
Unfortunately, some employers will deny that they agreed to anything that was discussed verbally. So you need to request that the negotiated agreements are written into your letter of offer.
That way, both parties have a legally binding contract of what was agreed to, and you will commence your employment with mutual trust and acceptance.
I know of some employers who have actually significantly changed the conditions of employment, even offering a part-time or a casual role, when the job advertisement clearly stated that it was for a full-time, on-going position.
If in doubt about your letter of offer and conditions of employment, seek legal advice, so you can be sure that what you are signing up to was in fact what you applied for.
If you can't get what you want, evaluate your longer-term strategy, and/or leave with integrity
Many graduates are only focused on the short-term objective of attaining a high starting salary. This is only a small part of a longer-term career strategy.
You need to ask yourself whether this is a stepping stone to a longer-term career objective. And if you are not satisfied with the offer, you need to walk away with your reputation and integrity still intact.
Authors of the classic negotiation bible, Getting to Yes, Roger Fisher and William Ury, who based their techniques on the Harvard negotiation project, say that ideally a good negotiation is not about getting angry or getting taken in.
Letting your ego get the better of you can also be career limiting. Use negotiation as a way to get a fair deal in terms of what you can offer an organisation.
Some employers will actually expect you to negotiate your worth, as the very role you are applying for may require those skills to use with their clients.
Weigh up the potential costs and benefits, and take time out to consider the offer if need be. Don't feel you need to accept the offer straight away. Thank the employer for the offer, and ask them politely if you can get back to them in an agreed time frame.
That way, you can reflect on what you are seeking in your employment to see if that is the right offer for you right now.
Recruitment Specialist | Talent & HR Partner | Education & Government
3 年Interesting article, Warren! I find it useful for the upcoming opportunities.
Application Support Analyst | Streamlining IT Operations & Enhancing System Performance | Bridging technical challenges and business needs
4 年This gave me a complete understanding of how to respond to such a scenario. As a matter of fact, it changed my radical way of thinking. Thanks, Warren Frehse.
Enthusiastic and passionate healthcare professional and patient advocate. Highly skilled communicator, possessing empathy and a positive attitude who excels with challenges.
5 年Thank you for the article. It was very helpful!
Social Services | Family, Student & Community Support Professional
5 年Good article, I really never thought of it this way.
Associate at Pollination | CFA Level 1 Passed | Startmate S23
5 年Great article with some very interesting insights, Warren!