One of the most frequent requests that I receive from individuals seeking my advice is how to negotiate their salary. The question often comes up during a job search, and later, when individuals want to renegotiate their salary. What you are paid is largely determined by the quality of the information you have regarding your worth to a company, and by your willingness to ask for what you are worth. Being able to demonstrate and document your value is exceedingly important. In salary negotiations, Rule Number One is: never try to negotiate a salary until you have received an offer of employment. Job applicants are often asked to provide a salary expectation or a salary history. I typically advise job seekers not to respond to a verbal inquiry or on an application form. Instead, I recommend that they simply say that their salary demands are negotiable, or that they are willing to negotiate. Why? If you quote a salary that is too high, you bid yourself out of the market. If you quote a salary that is too low, the prospective employer might believe that you do not understand the nature of the position, or that you are not really worth much, or that you are too hungry or too inexperienced for them to bother with. Why should they place a premium value on your expertise if you don't? You are in a much more powerful position when you have an offer in hand - after the employer knows exactly what you bring to the table, and after you know exactly what the job offers and what it entails. The personnel folks may push for an answer about what you expect in your first interview, so you may need to be creative in fending them off. Tell them that you are flexible and that you really prefer to negotiate your salary after you have a complete understanding of the position. Say something like "At this point I am really more concerned about the learning experience I will have and the type of work I will do. I think we can come to a reasonable agreement about salary after I understand all that this position offers and you have a sense of the talent that I bring with me." Rule Number Two is: do your homework! There are three basic pieces of information that you need to develop before you respond to any questions about salary expectations. First, you need information on competitive salaries for people already in the labor market who have skills, experience, and training similar to yours. Second, you need to develop a list of your assets and abilities. This helps you and the employer understand why you are worth what you are asking for. (A chronicle of your accomplishments should be kept in a diary throughout your career, so you will know when it is time to renegotiate and on what basis.) Third, you need to do a cost of living survey for the cities where you might be living. Your market research begins by obtaining a benchmark on what recent college graduates are receiving. My favorite source is the Salary Survey of the National Association of Colleges and Employers. (Experienced workers are often shocked to find that recent graduates are being paid more than those already in the field. This is where you get that information.) Responses are compiled from placement offices across the country and are published four times per year. The data are broken down by degree, major, industry, and job function. You can find this information on the CSUS Engineering and Computer Science Career Services website at www.ecs.csus.edu/career/salary.html. The annual "Kforce" Computer Salary Survey and Career Planning Guide provides excellent salary and career planning information for the experienced professional. The information is organized by discipline and by location. You can request a hard copy by calling 888.663.3626. Be sure to ask for the IT or engineering information based on your discipline (IT or engineering). I have referred to their materials for years and have found them to be exceedingly useful. The CSUS Engineering and Computer Science Career Services website links to this info too at the same spot: www.ecs.csus.edu/career. A third really good source for technical salary information is the National Society for Professional Engineers. They survey their members and report the information by education, experience, location, branch of engineering, industry and job function. I found the NSPE salary info at http://www.nspe.org/em1-salr.asp. (We link to this site also). Your relative value is determined by a combination of the assets you bring with you, including: your education, your specialized expertise, your experience, your skills (such as communication, organization, analytical etc.), military experience, maturity, and foreign language skills. Things external to you also enter the salary equation. The company size, the company's particular industry niche, the general economy (supply/demand), and the geographic location of your potential employer all play a role in the salary you will receive. The impact of these factors is constantly changing, and therefore, you need to stay current with your information. As an example, it used to be that salaries in Sacramento were discounted relative to the Bay Area. Today in Sacramento, salaries for computer, electronics, and telecommunications professionals are quite close to those in the Bay Area. THE SALARY CALCULATOR You can be a lot more flexible with your salary demands if you live in an area with a lower cost of living. In such an area, you can't necessarily expect as much, but you won't actually need as much. A good source for cost of living information is the "Places Rated Almanac" by Savageau and Boyer. You can find the book at Tower. This publication ranks about 350 metropolitan areas, comparing living costs, employment outlook, housing, transportation, education, health care, crime, recreation and climate. Rule Number Three is: know your strategy. First, you need to remember that your decision to negotiate for a higher salary should only be made after you have received an offer and after you have done your research. From your research, you should know what you are worth, what the market will bear, and the relative strength of your bargaining position. When an unacceptable offer is made, your response is to ask: "Is that salary negotiable?" Your question is actually a statement ("I want more money"), but don't worry about this minor bit of miscommunication; the people on the other side of the table will understand the question as a polite and proper opening move. Unless they tell you that the offer is the best they can do, they are undoubtedly going to counter with: "What did you have in mind?" When you hear that, the negotiations have been opened. This is where you do your work. You have to tell them what you want and why you deserve it. In essence, you have to explain the basis for your request and justify your demand. This is where your research pays off. In addition to the information you have gathered about what you are worth to them. You can also make your case by comparing their offer to others you have received. A computer science student I worked with received offers of $60K in the Bay Area and an offer of $54K in Folsom. When he started his negotiations he shared the info on the other offers and the Folsom company matched the Bay Area offers. The more offers you have the better. In other words, you can leverage your most desirable company that may have come in a little low with your other offers. When you present your opening salary request, it is usually best to go a little bit high so that you will have room for compromise. Go high, but be sure to keep it reasonable. And remember that you are not just talking about money. You have to evaluate the whole package, including benefits, opportunities, future potential, training, location, and so on. Compromise is the key to good negotiations. You are looking for a challenging career with a competitive compensation package. Their interests are the same as yours: they want to pay you what you are worth so that they gain a committed employee. They want someone who is satisfied and who won't waste time and attention thinking about finding a better opportunity or leave when the market improves after they have trained you. To reach this common goal, there has to be flexibility on both sides of the table. If they think they are paying you too much, they are less likely to value your contribution and more likely to view you as a top candidate for the boot if a layoff comes. If you are sufficiently inflexible, you may find the offer withdrawn - a valid option while negotiations are open. If you are negotiating for a raise in a position you already hold, unreasonable demands here might affect your future status in the company. You don't want to be viewed as someone who can never be satisfied. If they don't meet your expectations on the salary side, explore other aspects of the package. Perhaps they can offer other inducements. Maybe they can give you an office, instead of a cubicle, or perhaps there is a stock option sweetener. Yes the stock market may be down now but it will go up eventually. Keep in mind that all of those Ferraris down in Silicon Valley were paid for with stock that was owned before the company went public. The final task is knowing when to say "yes" or when to walk away. Actually, this is something that you should have known from the beginning. Before you even ask if it's negotiable, you need to know your bottom line. It may change while you talk - as more information is thrown into the discussion - but you need to have it stored in memory, available for reference or recalculation. You can do this. Just remember, be reasonable, be informed, don't be greedy, and most importantly don't be afraid to ask.