Failure to do this right means you do not know how the game is played. Let me explain. Salary is only one aspect of a job. There are many other factors that will impact your satisfaction with a particular position. You need to have complete information on all that is offered by the job and the organization before you make your salary demands known. You need to be presented with the entire package - salary, benefits, location, growth opportunities, the people you will work with, the perks and so much more... You are looking at a career, not a job. It may bring with it a whole new life in a whole new place. And they need to understand all that you bring to the table.
Do not tell a potential employer what salary you expect before you have been made an offer! (You do not really know yet). Do not tell them what you want! And never, never, never give your salary history. Your previous salary might be completely unrelated to the position you are seeking - like that food service position that paid for your education. If your experience is related you may have been an underpaid intern. Or the job you previously held might have been in a low cost of living area and the new job is in a high cost of living area. You might scare them away if they think you were overpaid. Why give them info that will ratchet down your salary or scare them off? Tell them you are n-e-g-o-t-i-a-b-l-e... (Learn how to spell it!) and at this point you need more information to make a good decision.
Although this might seem like an adversarial situation, or that I am advising you to be argumentative, this is actually a mutually beneficial approach. You need more information. They need to get the best possible candidate. That can only happen when everyone has all the details and data.
Ask the Headhunter Nick Corcodilos put it quite clearly:
"employers who insist are a bad risk ... why work for someone who tries to force you to share private information that has no bearing on your interview, on your value, on whether you get an offer, or on what the new salary offer is? ... when you disclose your salary information, your negotiating leverage is gone. Your salary history is not any employer’s business. Always decline to disclose, politely but firmly. No matter what they say, no matter what they threaten."Employers ask this question simply because they are in the habit of asking this question. Somewhere along the line, it became common knowledge among recruiters that this is a question that should be asked.
It is a useful question when recruiters and headhunters are seeking to lure high-value employees away from one company and place them in another. It is a useful question when a headhunter is asking: "what will it take to get you to move?" But when you are responding to an ordinary job opportunity, there is no good reason for the question to be asked and a number of good reasons why you should not answer.
In reality, it is never a useful question. If a recruiter comes to you asking you to become the new CEO of General Motors, your are not going to tell them anything about your salary requirements. If you are qualified for that position, you are going to wait and see what they offer, and then you are going to negotiate.
The same thing is true for any other job. Your job is to tell them what you have to offer, what you bring to the table, and why they should hire you.
If they put a price on the job offer in advance - they advertised the salary they were willing to pay and you applied, indicating that you were willing to accept that salary - then the negotiations are done, more or less (actually, you are still going to ask if that salary is negotiable before you accept the offer).
But if they left it open, asking what you want, then they have asked you to set the starting price. And they have asked you to set the starting price before you know how much they value your credentials or what you are worth to them. They are asking you to put a price on your talent based on how desperate you are to obtain work, rather than on what you are actually worth to them.
There are in fact a number of ways you can obtain information about what your experience and credentials are worth. There are great salary estimators available on the web (see my article about career/salary research).
But when you are applying for a job or responding to an inquiry, it is not the time to tell anyone what you are willing to accept or how much money you require.
There is a time to negotiate salary. It is not when you are submitting your application. You negotiate your salary when the employer is ready to make a commitment to you and when you are willing to make a commitment to them. You don't discuss your salary requirements until they have expressed an interest in closing the deal.
Never tell a prospective employer anything about your salary requirements. You do not really know enough about the position until you have gone through the entire process and interview process. Be patient. You need to know what the critical skills are that they are looking for, how you meet their needs, and what the total package looks like. It is not just about salary, it is also about benefits, living costs and future potential. When you have all of the information, that is when you will know how to value yourself and how to value the opportunity. Then you can negotiate.
When they ask you how much you want? You tell them: "Right now I am interested in finding out about the position and gaining a full understanding of the responsibilities as well as in sharing my background and qualifications. I think when we both have a fuller understanding of what the position entails and what I bring to the table, we will be able to reach a reasonable agreement."
Making a premature bid is just a really bad idea. Bid too low, it tells them you are not worth much, or that you do not know what you are worth. Either way you are demonstrating that you are not the brightest bulb or the fastest chip. Bid too high, they will know that you are not in contact with reality.
Let the employer make the opening bid, after they know who you are. The employer is the one who has the information necessary to determine what it is worth to them to hire you. You will have plenty of opportunity to let them know what the job is worth to you.
Copyright, Cici Mattiuzzi