Tuesday, February 7, 2012

Rate Expectations

A funny thing has happened over the last six months or so: hiring has picked up and pay rates have leveled out. People are getting paid fairly, very fairly in fact - but just not as high as pre-recession rates. This is causing a fundamental disconnect between job seekers and the people that want to employ them, making for a very inefficient- perhaps even stalled- hiring market.

Job seekers, it's time to really think about what you can reasonably expect in this market. Is your company downsizing and eliminating your high six figure salary role? You may be worth it, but that salary level isn’t sustainable. So, as you begin your job search, be prepared for a bit of sticker shock – it will be hard to match six figures no matter how good you are. So, be reasonable – don’t sell yourself short, but don’t say NO to a job because it is not six figures. And you may find a great job is right under your nose.

And if you're returning to work after a hiatus (child rearing, unemployment, you name it) your last salary level is almost irrelevant. Compensation is determined by supply and demand. That's why there are lawyers working for $30/hr and app developers making $130/hr. Don't take a salary offer as a personal affront, it's the job, not you.

What can you do to correct this disconnect?

  • Use your tools: Check resources like Salary.com and your industry professional associations to determine market and role specific compensation information. If you're really confused or in a niche industry, it might be time to bring on a compensation consultant to point you in the right direction.
  • Job Seekers: Do your homework. Know your value, research comparable salary levels and be flexible in your expectations. Let potential employers know if you won't be using certain benefits or if you're open to a lower salary now for a performance and salary review 6 months down the road.
  • Consider contract roles. If you don't need corporate benefits, consider a contract position that can sometimes (but not always!) offer you a higher hourly rate. If the rate is really unattractive, negotiate for an intermediate contract length: not so long that you're locked into an unappealing rate forever but long enough to knock their socks off so that you're in a better position to negotiate a higher rate at contract renewal time. That contract opportunity might just be your foot-in-the-door to your perfect next job.

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