Should You Accept a Job Offer, Or Negotiate It?
Congratulations – you’ve made it through the job search process, and now have a job offer. Should you accept it?
The answer is not as obvious as it might seem. You want to be confident about accepting an offer. To be confident, you need to know if the offer makes sense, or if you should be declining it or asking for a better offer.
Before You Decide…
You may be tempted to jump at an offer, but it’s important to carefully consider your decision. Taking a job can not only impact your daily life for several years, it can affect the course of your entire career.
Start by buying yourself some time. As soon as you receive an offer, thank the employer for extending it, tell them you’ll consider it carefully, and give them a date by which you’ll respond (typically 1-3 business days). You may want to schedule a meeting with them, so that you each have it on your calendar.
Is It a Good Offer?
In order to know if an offer makes sense, you need to know several things:
- What’s your desired salary
- your needs, preferences, and priorities
- the pros and cons of the job
- your market value
- the employer’s situation
Knowing what you need and want is fundamental. It’s usually a bad idea to accept a job that can’t cover your minimum financial requirements, or a job with a 6-figure salary that will suck your soul dry and ruin all your relationships. Beyond the financials, there are many aspects of the job that will be pluses or minuses for YOU – the working hours, facilities, co-workers, responsibilities, management relationships, growth opportunities, etc.
You may need to do some serious introspection to figure out what will work for you, but fortunately, you can do this work long before you get to the point of receiving a job offer. Once you have clarity on your wants and needs, you will be well-positioned to assess the quality of the fit of a job you are offered.
Assessing Your Market Value
Assuming that the basic parameters of the job itself align with your needs and preferences, we can come back to the topic of compensation. In order to know what you should be getting paid, you need to know your market value, which is determined by the laws of supply and demand. Jobs that can be filled by lots of candidates tend to pay less than jobs that require special skills, knowledge, and experience.
Fortunately, there are several websites that can help you get a pretty good estimate of the range of compensation you should be expecting, based on where you live, the type of work you do, and your skill and experience levels. Salary.com, SalaryExpert.com, and PayScale.com all perform robust research and analysis involving large data sets provided by HR departments, so their estimates of salary ranges tend to be pretty good.
Again, it’s a good idea to do this research well before you receive an offer, so you don’t have to do it under time pressure.
Considering the Employer’s Situation
Your market value is an important factor affecting your negotiating position, but you also need to consider the situation of your employer. If there’s an urgent need to fill a role, and qualified candidates are scarce, you may be in a strong negotiating position. If the employer’s need is less urgent, and many qualified candidates apply, you’ll be less likely to gain many concessions in a negotiation.
The size and reputation of the employer are also important. In general, startup companies have to offer higher compensation than well-established companies to attract candidates, because of the higher job demands and higher risks. Well-recognized companies with strong brands tend to attract plenty of candidates, and can usually hire all they need at relatively low compensation rates.
Understanding your employer’s situation will help you make wise choices in the negotiation process.
Is It a Good Enough Offer?
Let’s presume you’ve decided that the job is a good fit, and that the compensation in the offer is in an appropriate range based on your research. Should you accept, or should you negotiate?
As you might expect, it depends. If you and the employer had previously discussed a salary with which you’d be satisfied, and that’s being offered, the only honorable thing to do is accept. However, if you didn’t do your research well, that number could be lower than your market value, and lower than what the employer might have been willing to pay you. That’s why it’s best to defer discussions of specific compensation until after you and the employer have agreed that you and the job are a good fit.
Employers will often probe for your ‘salary requirements’ early in the interview process. You can’t blame them; they don’t want to go through the whole process and then find that what you require is way beyond their budget. Nevertheless, you don’t have to get too specific; you can ask what range they have in mind for the position, and if they won’t share that, you can state an approximate expected range based on your research.
If the salary being offered is low compared to the market range or the employer-stated range, you definitely should consider negotiating, because you have a good case to make for why you should be paid more. But even if the salary is appropriate, or if you know that the person extending the offer really can’t offer much more, you may want to request some non-cash improvements to the offer, such as additional vacation time, additional flexibility in working hours, a more desirable job title, improvements to the working environment, etc.
What Can You Negotiate?
Many candidates think negotiation is all about salary, but that’s where employers often have the least flexibility. Companies usually have well-defined salary ranges for positions, and many work hard to ensure that salaries are “leveled”, such that different employees with similar skills and experience working in similar roles are paid approximately the same. Plenty of candidates do manage to persuade employers to increase the salary offering, by making a compelling case based on qualifications and market comparisons. Plenty of candidates get firm resistance when they ask for higher salary, even after making a strong case. If you feel yourself hitting such a ceiling, it’s time to think about other things you might value that are easier for the employer to offer.
Direct financial rewards that may be easier for employers to offer include signing bonuses, performance bonuses, and equity (especially when tied to performance over a long period). Indirect financial rewards can include tuition reimbursements, access to company resources (vehicle, phone, computer…) for personal use, and contributions to savings plans or insurance premiums.
Beyond compensation, you might also want to negotiate over factors related to the job itself: your job title, the job responsibilities, the working environment (office with a window, perhaps?), working hours, supervisory relationships, and more.
Are You Putting Your Offer at Risk if You Negotiate?
Many people worry that attempting to negotiate could put their job offer at risk—that an employer might get disgusted and rescind the offer. But if the requests are reasonable and clearly justified, and there aren’t too many of them, there’s little risk of the offer being rescinded. By the time an offer has been extended, the employer has already invested a lot of time and effort into finding, screening, and interviewing candidates, and selected a preferred one. The offer is a clear signal that they want to hire their preferred candidate.
Employers usually don’t lead with the maximum they could offer; they generally leave themselves some room to negotiate. Even if they decide not to significantly sweeten the deal, they’ll usually honor their original offer.
If you’re still reluctant to negotiate, you should consider what regrets you might have later if you don’t negotiate. Negotiating a new job is a rare opportunity to increase your income.
Prepare Yourself for a Successful Negotiation
If you’ve decided that negotiation is appropriate, take time to prepare yourself properly. Get your personal priorities straight, and decide where you’re willing to compromise and where you aren’t. Do your homework on your market value, so that you have facts to back up your position. Think about your employer’s situation, and use any clues you can uncover to get a sense of where the employer might be willing and able to improve the offer. When you’ve figured out what changes you want to the offer, plan a strategy by deciding in what order you should make your requests. Don’t forget that salary negotiation starts on your initial screening call. Make sure you prep your self early.
To maximize your chances of success, it’s best to engage the services of a career advisor, who can help you with your preparation and advise you on strategy. A small investment in coaching can pay for itself many times over in the improvements you may be able to get in your offer.