In this guide, Mock Questions discusses essential factors to consider when approaching a compensation negotiation. We also uncover a variety of creative ways to ask for a bump in compensation, even if the COVID-19 pandemic has impacted the hiring company. You can apply this advice when negotiating a new job offer, or when asking for a raise from your current employer.
LOOKING AT THE STATS
At the beginning of 2020, the unemployment rate in North America was the lowest since the late 1960s. Around the world, people felt positive and more equipped to ask for salaries that matched their education, skills, and work history.
Then, the COVID-19 pandemic hit, and global unemployment rates skyrocketed seemingly overnight. In the U.S. alone, the unemployment rate jumped from 3.5% to 14.7%.
LOOKING AT THE BRIGHT SIDE
When we hear statistics like this, it's common to think:
Who am I to ask for more money at a time like this?
What does this mean for the scales of power between job seekers and employers?
With such an alarming jump in unemployment, did job seekers lose their power to negotiate their salaries?
We believe the answer is no. Here are a few reasons why:
A wide variety of industries actually thrived during the pandemic.
Despite a worldwide health pandemic, some key industries thrived - even having their best years yet! Many essential industries started hiring in droves, including:
Logistics, Shipping & Delivery
Technology & SaaS
Online Learning & Online Education
Grocery Stores & Essential Services
Healthcare & Telehealth Services
Job postings are reopening, and previously held roles are now vacant.
We continue to see more job openings become available every day. Some of these jobs are newly created, and some are unexpected vacancies.
While many people are keen to get back to work, plenty of employers have learned that their furloughed employees are not eager to return to their jobs.
During isolation, some people changed direction in their career and sought out new opportunities
Others felt inspired to start their own business, and are not returning to their post
Many are afraid to return to work and have declined the invitation
Some people had to move due to job loss
A significant number are now caring for health-compromised family members and cannot return to work
There is no doubt that life situations have changed for many people since COVID-19 made its appearance. Yet, with every life change, comes a new opportunity for someone else. It’s the natural cycle of employment.
Many jobs were added in the hospitality industry, as bars and restaurants reopened across the country
Healthcare added nearly half a million jobs
The construction industry also grew, adding over 150,000 jobs
Manufacturing also continues to grow
DO YOUR RESEARCH BEFORE APPROACHING A NEGOTIATION
Post-COVID, you should still feel comfortable in negotiating a job offer. However, you should be very well-researched when it comes to your requests. Be sure to consider:
How has the pandemic impacted the hiring company, specifically?
Today, it may be easier for companies to say they do not have room for negotiation, due to hardships from COVID-19. However, not all industry hardships are created equal.
For instance, the travel and tourism industry has taken a much larger hit than the logistics industry. While airlines were laying off millions of people, Amazon announced its need to hire 100,000 people across the U.S.
A variety of logistics and e-commerce based businesses were hiring in droves in response to an enormous increase in online consumer orders.
You can find out more about a company’s status by checking for mentions in the news, combing their website for updates, and asking the interviewer highly targeted questions about their response during COVID-19.
QUESTIONS TO ASK A HIRING COMPANY BEFORE ENTERING A NEGOTIATION
A responsible employer will appreciate a candidate who asks a few hard-hitting questions before accepting a job offer.
To the right hiring authority, a well-researched and thoughtful approach is an indicator that you are engaged in the hiring process and looking for a long-term fit.
Some questions you could ask include:
What was your company’s initial response to COVID-19?
What percentage of your staff were furloughed or permanently laid off?
How do you believe COVID-19 will continue to impact your business over the next 12 months?
Many companies have seen an unexpected positive change from the COVID-19 pandemic. Did your company experience any positive takeaways despite the global crisis?
Many job seekers do not realize that it is entirely acceptable to have a candid conversation with a hiring company about their financial health. You are, after all, taking a risk by joining a new organization in an economic downturn. It is up to you to ensure that you are making a smart career move that will offer longevity.
CHOOSE YOUR POINTS OF NEGOTIATION
When it comes to compensation, your focus does not solely need to be on the money. Some companies will not have as much wiggle room in their salaries as they once did. For that reason, you may want to consider alternative requests for a more substantial compensation package.
Aside from your base salary, or hourly wage, points of negotiation can include:
Extra vacation days. If the company offers two weeks’ paid vacation time, then ask for three. By adding one week of salary, you give yourself a soft bump in compensation without putting a financial strain on the company.
Larger commission percentages. Commission, performance, and profits are directly linked. So, by requesting a higher commission percentage based on performance, there is little risk to the hiring company.
Working from home. Many employees and companies now realize that it is entirely possible to work from home and remain productive. By working from home, you can save money on fuel and recover significant amounts of valuable time. You might also save on wardrobe and dry cleaning!
Signing bonus. If your job is in high demand, ask for a bonus upfront in place of a higher annual salary. This negotiation point is more welcomed if the company is in a hurry to hire, or if your skillset is genuinely unique.
Flexibility in your schedule. Flexibility and freedom can be worth much more than a few extra dollars. Ask for a schedule that allows you to work from home now and then, or arrive at the office at a more convenient time.
Opportunities to revisit salary. If the hiring company is firm in their offer and cites financial hardship to be the primary reason, consider asking for a review in 6 months. Be sure to get this offer in writing. You can also request to revisit salary based on the achievement of specific performance measurements. For instance, if you are in a sales role, consider saying, ‘If I exceed my sales targets by 15% or more in the first 6 months, can we discuss a salary increase at that time?’
Stock options. If the company is publicly traded and believed to be in good financial health, consider asking for added compensation through company stocks or a stock-matching plan.
Professional development opportunities. This negotiation factor is golden in a business landscape where career growth and skills development are critical components to job success and employability. Consider asking for a professional development opportunity twice per year. Or, ask for an annual budget that you can allocate to career-related education opportunities.
A change in the job title. If a company is genuinely unable to offer flexibility in any monetary way, ask for a more significant job title. Often, having a 'bigger' title can open you up for new and better opportunities down the road. If you feel that you are worth a more senior job title, be sure to ask for it. This approach costs nothing, but the residual impact can set you up very well in the future.
Childcare expenses. Childcare is a high cost for working parents and guardians. Some companies may have access to government programs that support working parents. Be sure to ask!
Performance-based bonus’. Consider asking the company to pay a premium based on your exceptional work! The hiring company's risk is low because the better you perform, the more profitable the company will be. Performance bonuses could include monthly, quarterly, or annual financial perks, gift cards, additional paid days off, and more.
Health benefits packages. Some larger companies may have pre-set health benefits plans that are not up for negotiation. However, if you are in talks with a smaller company and they do not offer a generous health benefits plan, consider asking for a health spending account. Start with $1,000 per year, and work your way up from there every time you re-negotiate your employment contract.
Undoubtedly, negotiations have changed for the time being. We are not currently in a market where job seekers have the upper hand and can ask for it all. However, you should still feel empowered to ask for additional and reasonable perks.
If you find yourself between a rock and a hard place with post-COVID salary negotiations, consider asking the hiring company a very straightforward question:
What have you offered other employees in the past, to help close the gap in a negotiation?
What do you suggest we do to bring this job offer closer to market standards?
If a company is unwilling to budge on any negotiation points, this could be a red flag that they are not expecting to recover for the foreseeable future. The question then is - are they stable enough to keep you gainfully employed?
Remember - regardless of the current economic state, there should always be room for a talented job seeker and a respectable employer to find a workable balance.
If you’d like to learn more about salary negotiations or tips for finding work during challenging times, we have two other guides that you may find helpful: