The money question always comes up in job interviews. If you are a
candidate looking at a new position, you can safely assume the person
on the other side of the desk will ask some form of the money question.
Your answer is difference between moving forward and being eliminated.
In
an interview, the employer has four basic questions in mind. However
they dress them up, whatever creative spin they put on them, employers
really want to know four things:
1. Who are you?
2. Why are you here?
3. What can you do for me?
4. How much will it cost?
That
final question can make or break the situation. If you answer it wrong,
you're done. The correct answer is non - numerical. A number, whether
too high or too low, is ALWAYS wrong.
The employer will
invariably ask something like, "How much money do you need to consider
for this position?" Or else, "What will it take for you to come to work
for our company?"
If you want to be considered for the position
do NOT, under any circumstances, give a numerical answer. The correct
answer is something on the order of, "I'm here to discuss the position
and assess my fit with your organization. I want to make sure my
talents are a good match for the duties you're outlining. You're
probably thinking along the same lines. I am sure, if we get to that
place, we can reach an accommodation."
Why answer that way? Because it's the truth.
The
demand - interest barometer tells us that, for a candidate, as demands
go up, interest goes down. And as interest goes up, demands go down. If
you as a candidate articulate a number too early in the process, you're
drawing a line in the sand and creating an impression that you're more
about reward than effort, more about price than value.
A number which is either too high or too low is wrong for several reasons.
The
interviewer will eliminate you from consideration if you articulate a
number that's too high. Whether they can afford the amount you say or
whether you're worth that amount is immaterial. If you as the candidate
create the impression that you overvalue your skills (in other words
say any number above the range they've calculated), they are concerned
you will never "settle" for the amount they're offering. So they will
remove you from the process.
Conversely, if you say a number
that's too low, you might inadvertently wind up accepting compensation
less than the amount the company budgeted because that's what you said.
You reduced your ability to negotiate because you have too little
information.
Over the years, in coaching people on successful
interviewing techniques, the money question is the one where people
stumble most often. Many times people will tell me, "I just wasn't
prepared for the question ... the number just popped out of my mouth."
Or else they will say, "I told her $X because I think I'm worth it."
Bottom
line, it doesn't matter what YOU think you're worth. The magic number
is always somewhere in the range between what they want to pay and what
you think you should get. I've been in career coaching and recruiting
for 20 years. This has been my experience.
When the employer
asks, "How much ... ? " the right answer is, "We'll know when we get
there." If they ask again, insisting on an answer, defer diplomatically
a second time. Something on the order of, "I appreciate you want a
number. I'm a little uncomfortable making anything which could be
perceived as a demand at this early stage. I'm interested in the
position and would like to learn more."
And if they ask a third time, the correct answer is, "My year to date compensation is $Z."
But
why give a number that way? Simple. It's a statement of fact, not an
estimate of self-esteem. You compensation is verifiable. An employer
can ask for and receive verification of income. You pay taxes. Your
income is a public record. In the real world, your current or most
recent employer valued you at an identified level. That's the number to
share.
So ... don't get caught by the money question. Role play
with a friend or practice in the mirror. Be prepared for this
inevitable question. Your ability to answer the money question with an
non-answer can get you the job or get you more money for the job you
really want.
The money question follow this blog post
| 11 comments
|
flag
11 comments
Log in or register to post a reply.
-
If an employer is working with a TPR these questions should be moot as that should be covered long before a candidate ever gets into an interview situation.
As Eric stated, I coach all candidates to state the facts and not put a number "in the box". If it's too high - you're out and too low you've lost opportunity to gain compensation.
The time for salary discussion is AFTER both parties are interested - how many times will a candidate take "less" for a better job, location, opportunity? How many times will an employer "break the bank" to get that exceptional talent? I don't believe anyone can answer "Never" to those questions.
For employers, put your self on the other side - do you come out and state "the salary range for this position is between x and y - would your salary requirements fit within that range? Probably not as the trouble with that is ALL candidates feel that they deserve to be "at the top of the range" so that leaves you open for a rejection if, in fact, they are the candidate you want to offer the position but not with an offer at or near the top of the range.
I believe that sticking to the facts is most appropriate. "What was your last/current compensation package" - not just salary because many peple now consider the entire "compensation package" to include more than just a base salary. They consider bonuses, 401k matching, cost for medical/health benefits, tuition reimbursements, etc. etc. as all part of their comp package. Miss these points and you are missing some of their expectations as well.
Our standard inquiry for candidates include ALL compensation figures and we also ask one other very important question - "What benefits do you have now that you feel are exceptional?" You would be suprised to hear what is important to some people other than their base compensation package - things like flex time, 9-80 work schedules, daycare, and similar items.
We all need to remember money is not the only motivator.
-
Jim,
1) It is possible to win $1M in a lottery. However playing lottery is not a good idea.
Yes, it's possible that I would eventually land the position if don't state my desired compensation up front and go through lenghty interview process.
But the chances of success story are slim (assuming that my original salary expectations are way off of what employer has in mind).
2) Sure, there are many important things aside of salary, but time cost of discussing these thing is much higher than time cost of discussing compensation.
I think that basic skillset match ("What can you do for me?") is the only thing that is more informative than brief compensation discussion.
So for me it seems natural to talk about expected compensation immediately after brief discussion of position requirements and how candidate's skills can fit with that position.
Bottom line: talking about expected compensation early on saves time.
-
I agree with Peter: sharing compensation expectations up front significantly reduces time spent on interviewing process (if compensation numbers don't match -- it's better to cut time losses ASAP).
Eric, are suggesting candidate to share compensation expectations with recruiter but don't share it with end recruiter?
That would empower recruiter for sure, but how lack of information would benefit candidate and employer?
-
Hmmm. I am not 100% sure that I completely agree with this post completely. However I do agree that most people can blow it if they don't answer the money question correctly.
There are multiple stages to this question. One is the recruiter to candidate conversation. This should be very open and frank, not beating around the bush. Two (the subject of your post) is the conversation between a candidate and Hiring Authority.
In my book I have dedicated the largest chapter to the salary question. It is that important. The candidate should side step the question at first like you suggested Eric but if the employer persists tell them what you current salary is. It is the responsibility of the recruiter to properly prepare the client and hiring authority of the desired and preferred level of compensation on the candidate. If a candidate is not working with a recruiter...this is a fine line.
Thank you for the post Eric.
-
Thanks, Darrin. For clarity and concision, I wanted to keep this post to the candidate - employer interview.
We agree that the recruiter and candidate should discuss compensation before the candidate gets passed through to the employer. If the candidate makes demands which are unreasonable or fails to substantiate current earnings, that person should be dismissed.
We also agree the recruiter should share information on candidate compensation with the employer. Sometimes the "real world" numbers will make the employers more realistic about a) what they can afford; b) how they might need to enhance the compensation; or c) what skills or experience they are willing to give up to stay within the range.
-
Agreed - just this morning, I had a conversation with a manager, telling him that the salary (lets call it 50k to use round numbers) was below what I was seeing on the market for people who did this work, and did it to what our specs were. The people who fit, were 15-20k more than this. It's market research and perspective, and that's part of our roles as well.
-
Yes, it's nice to bring real world, real time data into the conversation. That's why we bring added value to the work.
Glad you have a manager willing to take advantage of your input.
-
Eric,
At first I was kind of taken back by the article. I think you make a good point of coming full circle on how to answer the question with a fact.
I wrote about this on my blog a few days ago, and feel that salary is important up front. Aren't we doing a disservice to our candidates and internal clients if we don't cover the bases up front? What if the role is paying 80k and the person is looking for 120k.
We can generally make up the difference in salary if we are talking about a few dollars here or there (~5k), but what have we really done if we get all the way to the end without addressing what both parties want/need? Haven't we wasted the already precious time and energy that goes into sourcing and drving the right candidates through the pipeline?
Again, I like the idea of using facts to talk about salary because it at least provides a launching point for future discussions, but I think the absence of such a talk really hinders the process. Recruiters should be talking to people frankly (like a career advisor or agent) letting them know if they cannot meet expectations, but can keep an eye out for other good fits in the company, or if the salary flex changes.
-
Yes, Peter, you are right. Compensation is one of the primary issues for both candidate and employer. A good recruiter will assess the three obvious filters (skills, fit and location) and ask about money.
In your example, with a delta of 50 percent, there is no way a candidate looking for the larger amount gets into the interview process.
A lot of what I do as a recruiter is set realistic expectations at each step. That is my version of the "career advisor or agent" you state. The goal is to maintain positive communication with all parties at all times.
Thanks for the input.
-
A tactic that works for me is to ask the candidate what their current compensation is. If that number is higher than my budget, then I tell them that. This usually is a great barometer of where compensation ranks in their priorities. If their current compensation is in range, I usually ask if they are looking for the "normal" 5-10% increase in pay. A lot of the times they will say "yes, but I am flexible". I now have a range that I can work with. If they are looking for more than that, then I usually have no problem getting that out of them at that point since we have already started talking numbers.
-
Good tactic, Mel. Asking about current compensation and then giving feedback about the specific opportunity makes sense.
Also asking about expectations is a great idea. How many times have we as recruiters encountered candidates who want to give up a spouse's income and remain "whole"? Some people need to hear the voice of reality from the recruiter ... in a kind and positive way.
Once again, this post was written to coach candidates in an interview with an employer. Seems the comments come from recruiters with excellent insights ... which are very different from the candidates who approach compensation from an emotional, score keeping point of view.
Much appreciated, Mel.
