BOSTON (MainStreet) In considering the slow economic recovery and persistent stagnant wages, it is surprising to find that negotiating your salary can still lead to a significant increase in overall lifetime earnings and that it may be exactly the right time to apply this information.
"The good news is that though the economy is still sluggish, it is recovering," says Abby Euler, general manager of Salary.com. "There are many key indicators that it may be time to start thinking about negotiation again."
Research by Salary.com showed that a 4% raise every three years can increase total earnings by more than $1 million in a lifetime.
The negotiating can still be daunting, especially in this economy.
Last month, The Wall Street Journal reported the economy has been growing at only 2% well below the pre-recession average of 3.5%. With labor demand low, employers have not been under any real pressure to raise wages on their own. Even several years after the Great Recession, wages have not kept pace with inflation. In fact, the average hourly wage for a worker not in the government sector or working in a supervisor position came to a pitiful $8.77 an hour when adjusted for price increases, according to data from the U.S. Labor Department.
"Workers feel like they have absolutely no bargaining power," Robert Mellman, an economist at JPMorgan Chase
At the same time, workers also do not feel there are better job options. In June, only 1.6% of employed Americans quit their jobs compared with 2% to 2.2% annually at pre-recession levels. This may explain why 41% of Americans didn't attempt to negotiate for a raise at their current job or negotiate salaries when offered a new position.