June 5, 2009, 4:33 am

Negotiating A Raise During A Recession

by: The Financial Blogger    Category: Career,Personal Finance
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Economic data are still low, several companies are laying off employees and your house wouldn’t sell on the market that fast… do you think it’s a good timing to ask for a raise?

The short answer is no, the medium answer is “are you crazy?” and the long answer is “well I think this is a great time to negotiate”. On one side, companies look at their sales going down and profit shrinks. However, on the other side, they absolutely need their best resources in place if they want to survive and benefit from their competitors difficulties. Remember; if the market is bad for your company, chances are it is as hard for the competitors. Therefore, some companies will shine after the storm while some others will disappear in the waste.



So how and what can you ask from your employer in term of salary?

I must admit that asking for a gross rate of your income may not be the best idea ever during a recession. However, there are some ways and some situations where you can get a winner hand even if people are closing down their business around you. The best timing to make money is when everybody thinks the other way!

#1 Before asking for a raise; look at your market

Yeah I know, you have a name, you may have a family and you are a person. But for your employer, you are also an important asset. So look at you as a product for a second;

– How many assets like you in the market?

– Do they make more or less than you?

– Are employers looking to get more of this kind of asset right now?

Are you producing income for the company or are you part of a cost center? (i.e. assistance center, support team, back office, etc.)

– What is your potential, can you become a more interesting asset in the future? (you are in right to claim for the actual value of your future performance 😉 ).

Once you have determined your situation as an asset for the company, you will be able to know if asking for a raise is stupid or justified.

#2 Don’t go in your boss office asking for a raise and threaten him

The problem is not that you are not in a position to negotiate but you are in a delicate situation to ask for a raise. Your manager won’t be the happiest guy on earth when you will ask him to bleed off his budget in order to increase your salary. However, if you are asking for a decent and justified raise, he will more likely think about it.

The best way to approach your boss for a raise is to build your case. Still think of you as an asset for the company and write down the reason why you think this specific asset worth more. Here’s a few tricks:

– Ask for a raise that fits the market.

– If you want more than the market, you need to show why you are that good.

– Being good is not about feeling good about your work; it is a matter of facts and results. Since chances are that the people that will ultimately approve your raise don’t even know you, facts will guide his decision.

– Don’t talk about your colleagues saying they don’t do this or that or they make more than you. You don’t want to be shown as a whiner but as a winner. Talk about the market in general and your attributes compared to what is required on the market.

– Go see a head hunter to make sure your assumptions are good. You may even walk away with a job offer.

– Never threaten or let your boss think that you will go see elsewhere. The point is to affirm that you are happy where you are and that you want to work for your company. However, you think you worth more. Employers don’t like entering into a income rally for an employee. They know they may lose the very same guy in 6 months if there is a better offer on the table. Use your loyalty as a benefit from the company.

– Give your manager time to think about your raise. There is no point of pushing him to raise your income right after your meeting. He will have time to build is case and get the proper authorization. Let him do his job.

I’m actually using those tricks to my personal situation right now… I’ll let you know how it went in a few weeks 😉

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Comments

Being part of a cost center might not be a bad thing; if you can show that you do as much work as two average people then you can get a nice raise while saving your employer money 🙂

Interesting. In my situation, I would consider the short answer. I do not have a power situation… I’ve just started a new job and prefer not to put myself in a delicate situation!!

Hehe good luck! Keep us updated!

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Thanks for sharing such great post, it will surely help many people to get such detailed info.

[…] The Financial Blogger. Negotiating a raise during a recession. “Economic data are still low, several companies are laying off employees and your house wouldn’t sell on the market that fast… do you think it’s a good timing to ask for a raise?” […]