Authors: Gayle Laakmann McDowell
Tags: #Business & Economics, #Careers, #Job Hunting, #General
Location
Let’s look at two hypothetical offers: Jason is offered $75k by Microsoft (Seattle, Washington) and $80k by Google (Mountain View, California). Google pays better, right? Wrong! California has a 10 percent state income tax, whereas Washington has a 0 percent state income tax. Google’s $80k offer is really more like a $72k. And on top of that, Mountain View is, according to
Payscale.com
, about 25 percent more expensive than Seattle.
A dollar simply goes further in some areas. When comparing offers, make sure to take into account the location of the company by using cost-of-living calculators such as Payscale’s.
The Happiness Factor
It’s easy to look at a big, fat number in your offer letter and say, “Hey, I can stick it out a few years, right?” It’s a lot harder to actually do that. Unhappy employees tend to work fewer hours, be less productive, and quit earlier.
Before taking a job where you suspect you’ll be unhappy, think through whether you can really deal with it. Yes, you can handle long hours, if you like the work and your teammates. You might be able to deal with tasks you don’t enjoy, if your coworkers are fun and the hours aren’t terrible. But tedious work, long hours, frustrating coworkers, and a bad manager? It’s a nightmare, and you’re likely to quit so quickly or perform so poorly that you won’t get much out of it, anyway.
What you need to figure out before applying to jobs (or at least before accepting a job) is the following: What makes you happy? Is it the people you work with? Is it being intellectually stimulated? Is it the feeling of accomplishment? Or impacting people’s lives? It’s easy to say “yes!” to all of these, so you should compare your answers to your previous jobs. Why were you happy or unhappy?
The following factors are important to many people:
How Can You Negotiate an Offer?
You prepared thoroughly, you sweet-talked your way through résumé blemishes, and you mastered all the hard balls they threw at you. Finally, the offer comes and your mouth drops; it’s thousands of dollars lower than what you’d hoped for. What can you do?
That depends on
what
you’re trying to negotiate, and by
how much
. You probably can’t argue your salary from $55k to $80k, but you might be able to persuade your recruiter to bump your salary up from $75k to match a competitor’s $78k salary.
Should You Negotiate?
Most candidates, particularly recent graduates, don’t negotiate their job offer. The reason? They’re nervous. They’ve worked so hard to get the job, and they don’t want to risk losing their offer.
Richard, a recruiter for Facebook, tells you not to worry. “Once we’ve decided to hire you, we’re going to do everything we can to do that. A little negotiating will not hurt you.”
So go ahead and discuss your concerns with your future company. As long as you’re polite and respectful of the recruiter’s time, no one will fault you for negotiating.
What Can You Negotiate?
Virtually any part of your offer
can
be negotiated—after all, rules are made to be broken, but some are much harder than others. Vacation time, for instance, is usually quite rigid because it’s so visible. When companies state exactly how many vacation days are awarded for each year at the company, it’s difficult to bend the policy, even for exceptional candidates.
Some of the easiest (and most commonly negotiated) terms are salary, stock options or grants, relocation, and the signing bonus. Stock options are often the most flexible, since their exact value can be relatively hard to quantify and can fluctuate too often to have rigid HR policies. One candidate, Amy, convinced Google in 2004 to double her stock options. Though she had no idea of their actual value at the time, she became very thankful a few months later when the company completed its initial public offering (IPO).
Sometimes, negotiation is more about changing the terms—in a way that may be neutral to the company but positive to you—rather than truly improving a term in an absolute sense. For example, Microsoft offers a wonderful relocation package where movers pack up all your stuff, transport it to Seattle, and unpack it in your new location. As nice as this is, you might prefer just to enlist friends to help with moving and take the cash instead. Many college candidates have done just this, and walked away $5,000 richer. After all, they didn’t really want to keep that old futon with the beer stains.
Seven Tips to Winning Negotiations
When you get an offer, the first thing you should do is to thank the company for their time and to reiterate that you are confident that you can do an excellent job. The second thing you should do is open the negotiations. Following these tips will ensure more positive results:
1.
Don’t name the first number.
The first person to name a number can overshoot too much and turn off the other person (“He offered that?!? What’s the point in even discussing it!”), or, even worse, might lowball himself. Whenever possible, avoid giving the recruiter a salary range by saying that there are many factors you evaluate in a job and that it’s difficult to provide a range. You may even be able to tactfully avoid giving your prior salary by stating that your company does not permit disclosure of salaries.
2.
Have a viable alternative.
You can claim that you are really excited about doing system administration for your brother’s company, but Google probably won’t buy it. However, if you tell Google that Microsoft is offering you $5k more, you can bet that Google will feel much more threatened that they’ll lose you. Also, don’t forget to take location into account. It’s perfectly reasonable to tell Google that while their salary is $1,000 higher than Microsoft’s, it’s effectively much lower with the cost-of-living difference.
3. Do your research.
By being armed with data about industry salary and what your company offers to similar candidates, you’ll have a much better idea of what is reasonable to ask for and what isn’t. Check out web sites like
Glassdoor.com
to research salary ranges.
4. Have a specific “ask.”
If you ask a recruiter for just “more salary,” they’re likely to bump up your salary by an insignificant amount, putting you in the uncomfortable position of needing to ask
again
. Instead, you should approach your recruiter with specific demands: salary of $X, signing bonus of $Y, and so on.
5. Overshoot.
The salary that you request acts as a ceiling: the most a company would have to pay you for you to accept their offer. A recruiter is likely to shoot for somewhere between the initial offer and what you ask for, so you should overshoot by a bit. But don’t go overboard; asking for a $200k salary in your first year out of college just makes you come across as unreasonable.
6. Use your best medium.
Many people will insist that negotiations take place over the phone. If you’re comfortable doing so, then by all means, pick up the phone and call the recruiter. But if you’re not—if you think you might get bullied into accepting a subpar offer—then stick to e-mail, where you can tweak every word.
7. Sell yourself.
Though you’ve gotten the offer, you need to continue to sell yourself. A recruiter who thinks you’re working with them (rather than just griping about every penny), who enjoys your personality, and who thinks that you’ll add value to the company will do more to get you there.
And remember: if and when the company agrees to your terms (or you to theirs), the negating is done. You cannot go back and ask for more. You should tell them how excited you are to join them, and always, always ask for the offer in writing.
Tricky Issues: Deadlines, Extensions, and Declining Offers
How you communicate with your recruiter or manager is a sign of your professionalism. Are you cognizant of the time and effort they spend recruiting, or do you think that recruiting is all about you? By being open with your recruiter about your other pending offers and your feelings about the job, you can avoid catching her off-guard. Recruiters just
hate
surprises—or at least they hate bad ones anyway.
Deadlines and Extensions
When Amazon first offered me a job, I was given one week to decide. The problem was that I was still mid-interview with Google and Microsoft. I explained to them the reality: I could not make a decision without all the options in front of me. And guess what? They waited for four weeks, until I finally turned Amazon down in favor of Google.
Companies give deadlines for a good reason; they can’t effectively interview candidates while holding open a position for you, nor do they want to drag out a decision for too long. Within reason though, they will negotiate with you to extend the deadline.
If you need an extension, simply be up front with the recruiter. Explain to him
why
you need an extension,
what
your status is with other companies, and
when
you’ll be able to have a decision ready:
Hi Samantha,
I noticed that you had given me a deadline for this offer of the 16th. I’m a bit concerned about my ability to meet that. While I’m very excited about Microsoft, I of course feel it’s important to have all my options in front of me before making a decision. I’m sure you can understand that.
I’m currently in the process of interviewing for Google, and I’ve asked my recruiting contact there to expedite the decision as much as possible. I will interview with Google on the 14th, and I hope to hear back by the 20th. I believe I’ll be able to make a decision quickly thereafter.
Could we push back the offer deadline until the 25th?
Thank you,
~Gayle
Note that I didn’t just say that I need an extension, but I also gave the recruiter my status with Google. The reason for this is that she may know much more about Google’s process than I do. She may know, for example, that it’s difficult for Google to make a decision within a week.
In smaller companies or companies with very specific openings, extending a deadline substantially may be more difficult. Companies like Google or Facebook, where your offer doesn’t come from a specific team (and thus you’re not blocking their recruiting) are more likely to be amendable to extensions.
Reneging
The common advice is “never, ever renege,” and, well, I hate to argue with that. They’re right, more or less. Reneging is somewhat unethical and, frankly, should rarely come up. After you accept an offer, you should reject all future interview requests. You shouldn’t even be in a position to be tempted.
But things happen. Sometimes a company that previously rejected you comes back with a spontaneous offer. And it’s just too good to turn down. Then what? Then you have a very difficult decision to make.
In fact, that’s exactly what happened to me. Just before my last year of college, I interviewed for internship positions at Apple and IBM. Apple rejected me, so I accepted IBM’s offer. I was just lukewarm toward IBM, but I didn’t want to go back to Microsoft for a fourth summer, so I accepted IBM’s offer. Three months later, Apple came back and offered me the position. Apparently, their number one candidate reneged, and I was number two.
Perhaps I should have turned it down and taken the “high road,” but I was just too excited about the position to do that. My IBM recruiter was furious (probably more so after offering her a lame excuse about my sick grandmother), but they found a replacement—a girl who probably reneged on her offer with another company. I’ll never know how far this reneging chain goes.
The guy who reneged on Apple (to go to Microsoft) took a much more honest approach; he told Apple about the Microsoft offer (which was apparently unusually high), and they were supportive of him accepting the other offer. He never needed to worry about bumping into his Apple interviewers years later, because they knew what had actually happened.
In an ironic twist of fate, I met this guy three years later in an interview room at Google. I didn’t know his name previously, but the candidate’s “how I got to Microsoft” story sounded so eerily similar that I made the connection.
So, no, I don’t think that reneging is always and absolutely the wrong thing to do. After all, the decision impacts you far more than the company. But it should be taken very, very seriously. It can damage your reputation, your school’s reputation, or your friend’s reputation if he/she referred you. And, of course, it hurts the company itself. Think long and hard before doing this, and avoid taking any more interviews once you’ve accepted an offer.