Salary Negotiation for College Grads

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Recent college graduates aren’t making as much as they used to. A new study conducted by the National Association of Colleges and Employers (NACE) shows that the average starting salary for the class of 2010 is down 1.3%. Now, new grads are being offered, on average, $48,691 a year by employers. Last year at this time, class of 2009 alum were receiving an annual salary of $49,307.

“It’s simply reflects that there’s a decrease in demand,” Mimi Collins, NACE’s Director of Communications, explains. “When times are good, employers may want to hire people who have experience, but can’t find them, so they consider college graduates instead. In times like this, organizations that focus on college recruiting often have fewer openings.”
 
Fewer job openings may entice recent college graduates to take whatever salary is offered to them, but should those new to the job market rule out negotiating their way to higher pay? The answer, it seems, is not entirely.

“Salary negotiation is par for the course in the professional world,” career counselor Heather Krasna tells MainStreet. “If it’s done right, it can add thousands to not just your starting salary, but salaries you later earn for the rest of your career.”

Salary negotiations may increase your income, but applicants (especially those new to the job hunt) are often reluctant to bring up money during the interview process.

”Most of us were scolded as children when we asked how much a gift cost, how much that neighbor’s new car cost, how much money your dad made … so we’ve learned it’s impolite to talk about money in any situation,” Matt Scheihing, executive recruiter for J. Miles Personnel Services, tells MainStreet. “The fact is it’s impolite to talk about money at the inappropriate time.”

This means you can have your own set of salary requirements. You just need to know how or, more importantly, when to use them. For example, career experts universally agree that it is not a good idea to bring up a list of demands during your first interview. To do so means, yes, you may alienate employers. However, conversely, you risk shortchanging yourself. 

“If you state a range that is too high, you might be taken out of the running before you have a chance to prove to the employer that you are the ideal candidate,” Krasna explains. “If you state something that is too low, you have just lost money that you could have earned.”

Typically, salary negotiation specifics should be reserved for after a company has made you a job offer. However, there are soft ways to approach the topic earlier on.

“Interviewees can voluntarily tell the employer, ‘I’m considering new opportunities in the $60K-$70K range. Does my salary requirement meet the salary range you’re offering for this position?’”Scheihing suggests. “That is the basic qualifier to know you’re competing for a job that is at least in the ballpark of what you would consider.”

Asking basic exploratory questions will prevent you from wasting your (and your prospective employer’s) time and are not expressely forbidden. As Scheihing points out, an employer is essentially buying your talent and anyone looking to purchase something ultimately needs to know what it costs.  Just make sure that whether you mention salary in a second interview or after an actual job offer, you know exactly what it is you are talking about.

“It’s important to make sure you have adequate backup for your salary negotiation other than that you ‘deserve’ a certain amount [of money],” Nawoj says. “What is the going salary for an entry-level position in your field? What do others you know at similar levels make?”

Jobseekers can use websites like CBSalary.com, Payscale.com, Glassdoor.com or Salary.com to get an idea of what workers in their prospective fields make in particular geographic locations. NACE can also provide applicants with some vital stats about their desired professions. (Psychology majors, in particular, may want to reference the NACE study since they are making 5.6% less than their 2009 predecessors.) As Nawoj points out, the more thorough the research, the more likely it is you will convince employers you deserve a particular salary. Additionally, citing personal debt or financial troubles to rationalize a request for higher pay isn’t likely to net you an extra cent and could negate your job offer entirely.

“It’s possible to jeopardize an offer if you don’t do the request right,” Krasna says. “You first have to be appreciative about and excited by the offer. If you just state that you are waiting for a better-paying offer, you could lose [the job].”

Those worried about their negotiating skills do have other options. For instance, if talking money scares you, consider discussing other aspects of your job offer, such as benefits, 401(k) options, start date, typical working hours or vacation days.

“Always make sure the employer understands you will be negotiable on the total package,” Scheihing advises. “There is value in non-cash compensation like a company car, health insurance, retirement match, time off, etc.”

You should also guarantee a back-up plan.

“If you have to take a lower salary, consider asking what the promotional timeline is and whether you could have an early performance review tied to a potential raise,” Krasna says, adding that you should ask that this request be confirmed in writing.

“Ask for a six-month or year salary review when you accept the job so that you know the conversation will be brought up in a specific amount of time,” Nawoj agrees. “In the meantime, be a model employee. Finish projects on time, go above and beyond and offer to help on different teams. Keep track of the tasks you take on, specifically ones that help the company’s bottom line.”

That way, you’ll be less reluctant to ask for a future wage increase.

Worried about how you are going to manage your money post-college? Check out MainStreet’s article on financial tips for new college grads.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

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