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  Employee Salary Negotiating Power on the Rise?
Employee Salary Negotiating Power on the Rise?
In a recent Salary.com survey, 31% of respondents feel that they have more negotiating power now than they did a year ago.
 

-By Jon Simonini, Salary.com

Could it be that employees are gaining back some of that salary bargaining power they lost during the recent recession? Experts and employees alike appear to believe the answer is either "yes" or else it is "coming soon," while in some areas of the country, a few are concerned the trend may be heading in the opposite direction, in favor of the boss.

In a recent Salary.com survey, 31% of respondents feel that they have more negotiating power now than they did a year ago, compared with 27% who believe they have less negotiating power. With the increase in the number of jobs available, many people feel that they have the power to negotiate their preferred salary. Bradley Schaufenbuel, a job seeker and survey respondent, thinks that salary negotiating power is on the rise for employees: "I believe that employers can see that an economic recovery is underway and that the job market is beginning to heat up. They know that when the current talent pool begins to evaporate, they will be hard-pressed to attract star performers."

In recent years, when companies were slashing jobs due to the declining economy, negotiating your salary seemed like less of an option. Caroline Levchuck, a contributor on the topics of salary and negotiations for the Hotjobs career site, agrees that "in a competitive job market, job seekers sometimes think that they're lucky to land an interview, let alone receive an actual job offer." However, with the beginning of an economic recovery, the majority of professionals are feeling more empowered to accurately gauge their professional worth and, therefore, negotiate their salaries to the desired level.

Of course, the economy is just one of many driving factors that determine an employee's salary negotiating power. "Knowing which of your skills and experiences are most important, and most valuable, to your employer or potential employer is crucial," says Bill Coleman, head of compensation for Salary.com. "These same attributes are what you can use to negotiate a personal value above the market median for your job." Estimating a personal value may involve demonstrating your abilities through your resume of past work experiences, or compiling a "works in progress" resume that details your recent accomplishments with your current employer. Agreeing on a benchmark job is step one in a five-step process Salary.com describes as the "new salary negotiation." (You can read more about the "works in progress" resume, also known as a "job diary", along with more Salary.com negotiation advice in our Negotiation Clinic).

The employment picture may be improving, but some say employees should not rush in to the boss' office just yet. In the Salary.com survey, there are still 27% who see no change, and 27% who even feel they have less negotiating power now than they did 12 months ago. Has the pendulum swung back toward the employee? "Not yet," warns Paul Barada, the Negotiation Expert of one of the online message boards for Monster. He tells employees that "many companies are still operating with lean staffs and probably won't start hiring until demand for goods and services outpaces their ability to deliver, then the demand for competent employees will increase and, if the skills you have are needed, your ability to negotiate successfully will also increase."

Where you live is an important factor. One survey respondent who feels she has less negotiating power these days lives in San Francisco and sides with Barada, saying most companies there are surviving on smaller staffs. "With that type of fierce competition," she says "salary negotiation is simply not a part of the job-hunting equation." In her case, which seems particularly insightful, she feels that negotiating with her prospective employer actually worked against her. While job searching she found a company, interviewed, and finally received a low offer. "I attempted to negotiate that offer, assuming, as in the past, that most companies' first offer is on the low side, with the expectation that the candidate would negotiate the salary." As a result, the counteroffer was passed along to Human Resources with some positive feedback, but only to find out two days later that the offer was withdrawn. "Employers simply know they now have the upper hand and know that if people are faced with no salary or a low salary, the decision will be to earn something."

As Coleman points out, the negotiation table is set with a group of factors that all work together. This is the case whether you're an entry-level professional working in a small business or Alex Rodriguez negotiating his $22,000,000 contract with the New York Yankees. And of course, a job contract is not only about pay. You may be like Manny Ramirez, content with being slightly below Rodriguez' pay grade, but comforted by the fact that you helped the Red Sox win their first World Series in over 80 years.

Clearly, employees' bargaining power is nowhere near the level of the late 1990s, but the tide may just be turning compared with the last few years. Starting with solid research, from a group of sources that may include a Personal Salary Report, it could be time to reassess your worth.

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