Want a Pay Rise? The Art of Negotiating a Higher Salary - Even During a Recession

"I was going to ask for a raise and then COVID hit. Now there's talk of a looming recession. When's it going to be OK for me to negotiate my salary?"

Nobody can deny the last few years have been tough. And by all accounts it doesn't look like things are going to improve any time soon. But does that mean you should be placing your financial/life goals on hold until things settle down?

Negotiating a pay rise can be daunting, even at the best of times. During a recession, it can become even harder. You don't want to seem greedy, insensitive or ungrateful, and at the same time, you want to advocate for yourself, be fairly compensated for your work and make progress to your vision of what living life on your terms means to you.

If you're not happy with your current salary, you have 3 choices:

1) not do anything and continue to be unhappy and resentful, appreciating the impact of both on your performance, relationships, self-worth etc.

2) take control and ask for what you're worth

3) make peace with putting a salary negotiation on hold for now and any consequences of that choice

4) find other ways of building wealth/generating income (e.g. investing, property rental, building an online course).

“Is there a right time to ask for a pay rise?”

“Is it even appropriate to ask for a salary increase during a recession?”

There are no hard and fast rules when it comes to negotiating a raise. But, as the old saying goes, “If you don’t ask, you don’t get.”

So – should you ask for a salary increase during an economic downturn? If yes, is there a better time to ask than not? And if so, how should you do it?

What does a recession mean for companies??

We all know a recession means an economic decline. But what impact does it have on businesses, and how does that affect our salary negotiation?

For some companies, a recession will mean fewer sales, reduced profits, cost-cutting, redundancies, reduced credit and cash flow, a decline in stock prices and dividends etc. The reduced funds available can also impact the quality of products and services being offered.

In more recession-proof industries, the impact of an economic slump will be less or even zero. There will also be companies and industries that even thrive during recessions.

Recessions will also force companies re-evaluate, reassess, innovate and re-invent; which can lead to greater success at a later stage. And as some companies close, surviving companies blossom with less competition. It will be what’s happening in YOUR company that will shape the what, when and how of your salary increase negotiation.

When to Ask for a Raise

Of course, the best time to ask for a raise is when the company is in a good financial position. In a shaky economy, you may need to be more strategic when asking for a raise.

Getting the timing right

1)????Assess what’s happening in your company

If your company is seemingly unaffected by the recession, the timing might not be so much of an issue.

However, if your company has communicated financial struggles or is showing signs of financial distress (e.g. unable to make payments, reduced sales, cost-saving initiatives, redundancies, stressed-out leadership) a little bit more sensitivity will be required. With any negative change comes the grief cycle – shock, denial, anger, stress, depression, until finally, acceptance. When fear is rampant and everyone is stressed, it may be perceived as emotionally unintelligent and environmentally insensitive to ask for a pay rise. Waiting for the acceptance phase not only demonstrates emotional intelligence but with stress levels reduced, you're more likely to have the productive conversation you want around your salary increase.

2)????Use positive performance reviews/feedback as door-openers

Positive feedback whether in a formal performance review or general day-to-day activities is a good sign your company are happy with you and your work. Both can be great door-openers for conversations around a salary increase.

3)????Time your request around key projects.

If you have just completed a big project or helped the company achieve a major goal, that is an ideal time to ask for a raise. Your boss will be impressed by your contributions and may be more likely to give you a raise in recognition of your efforts and success

What to Ask For

You might know you want a salary increase but what amount should you be asking for? Is it 5%? 10%? 20%?

The answers to these questions will depend on:

1) whether or not you’re currently being underpaid compared to the market rate

2) how far above your KPIs you have gone

3) the monetary/positive contribution your additional efforts have made to the bottom line and/or company/team performance

4) the budgetary restrictions on salary increases

When figuring out what salary increase to ask for:

1.????Do your research. Know what the market rate is for your position in your industry industry. This will help you to gauge the average salary for your role, and also give you ammunition to back up your request.

2.????Appreciate doing your job and length of time in your job are NOT good enough reasons to ask for a pay rise. A salary increase is only warranted if you have gone above and beyond the KPIs of your job description. You will need to prove that your additional efforts have made a significant contribution to the bottom line or company/team performance. Do your best to calculate the impact of your actions on efficiency (translating into a monetary savings if you can), expenses and revenue. The more money your contributions have directly or indirectly saved or made the company, the more you can ask for and justify when negotiating your salary.

3.????Be prepared to compromise. Many companies have strict salary bands that they have to work within, offering little to no room for significant pay rises. Be open to other forms of compensation such as incremental performance-based bonuses, a promotion in job title and responsibilities until the budget has been found, better medical insurance, flexible working etc.

4. If you're told a hard "no" due to lack of budget, ask for a performance/pay increase plan over e.g. 3-6 months. Set some specific goals and targets with your manager to be consistently reached during that period and agree on a salary review at the end.

How to Ask for a Pay Rise

This is where many people get stuck. Lack of confidence in their negotiation skills is why some people put off asking for a salary increase. But for many, there’s also an underlying sense of doubt around their worthiness of a salary increase or confidence that their achievements merit one. Remember – selling is 90% conviction and 10% convincing. Being confident in your worth and your ability to handle negative feedback or pushback are key in negotiating your salary

1)????To increase your sense of worth: write down all of your achievements and all the things about you (skills, knowledge, experience, character, qualities and traits) that helped you to achieve them. Remind yourself of these things daily.

2)????Prepare a list of as many achievements as possible that show your additional contribution (above your KPIs) to the team/company performance and/or bottom line. The more data, figures, facts and evidence you can provide, the stronger your case.

3)????Present your case with conviction. If you don’t believe in your achievements or worth, why should your boss? Be factual in your presentation and your tone, and communicate your achievements and data with strong, confident, composed body language and voice. Make a clear link between your achievements (surpassing your KPIs) and company/team performance. Practise what you want to say and how you want to say it (in the mirror) as many times as possible.

4)????Be prepared for pushback. As much as it might feel like you’re being criticized or your request isn’t being heard, see if you can see it from their perspective. What are their biggest fears and concerns? What matters to them? Approach the conversation with a solution-oriented, win-win mindset and seek to find a resolution that works for both parties.

The number one reason you'll get a raise is that you asked for it. That's right - the simple act of asking for a raise can often be enough to get you the pay increase you deserve.

The economy may be shaky, but that doesn't mean you can't negotiate a raise. If you have a good case for why you deserve a raise, ask for it. And remember, even if you don't get the raise you're asking for, you can still negotiate other benefits or perks that will make a difference to you.

What else would you add?

Zeta

If you're a career-minded, senior professional looking to take their career to the next level, let's talk! Reach out at?www.zetayarwood.com

Enjoyed this newsletter and believe a friend or colleague would benefit from reading it? Please feel free to share. Thank you!

Zeta Yarwood is a leading, award-winning international Executive Coach, Career Coach and Life Coach, helping leaders worldwide achieve success in all areas of their lives. With a degree in Psychology and over 15 years of experience in coaching, management and recruitment – working for multinational companies and award-winning recruitment firms – Zeta is an expert in unlocking human potential. Passionate about helping people discover their strengths, talents and motivation, Zeta lives to inspire others to dream big and create the life and career they really want. A "LinkedIn Top Voice" and voted one of the "Top 50 Most Impactful People On LinkedIn" two years in a row, Zeta has a LinkedIn community of over 250,000 people, and is dedicated to sharing her knowledge, experience and insights to anyone who might benefit from it. You can gain access to those insights by following her here:?Zeta Yarwood, LinkedIn.

For further information on coaching and general career/life inspiration, please visit?www.zetayarwood.com

https://zetayarwood.com/career-coaching/

https://zetayarwood.com/executive-coaching/