According to a report by The Conference Board, salary increase budgets in 2022 are expected to be 3.9% – the highest rate since 2008.
Though negotiating your salary seems intimidating, Andres Lares, the managing partner of the Shapiro Negotiations Institute, told FOX Business that it’s important for people to ask for a raise, so they don’t miss out in the long run.
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Lares said that some studies have estimated an average salaried employee who doesn’t ask for raises could miss out on as much as $500,000 to $1 million over the course of their career.
There are a lot of factors that go into that estimate, including potential missed investments with compound interest and missed roles and opportunities at a higher level that could lead to a higher salary, Lares said.
If you haven’t asked for a raise in several years, Lares said there’s even more incentive to ask for a raise now.
"If you made $50,000 today and you made $50,000 five years ago, if you just look at cost of living increases, you’re making less than $50,000 now," Lares said.
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If you’re planning to ask for a raise this year, here are some negotiating tips from Lares.
Negotiate over more than one thing at a time
To make your salary negotiation more productive and collaborative, don’t only discuss your pay, Lares said. When people only discuss pay, negotiations become fixed sum and aren’t collaborative, he said.
Without asking for anything "outlandish," employees should bring their job title, remote work options, 401k contributions, paid time off and health insurance to the table, as well as their salary.
"You’ve now, all of a sudden, put five or six different things on the table and that allows you to collaborate to a solution that works for everyone," Lares said.
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"If you take a step back and you think of it empathetically, when you approach, it sounds so different," Lares said, encouraging people to think about why your company might not give you a raise.
Lares said an empathetic conversation with a manager could look something like saying: "I know that you’re swamped with hiring and I know that 2021 wasn’t a good year with COVID-19, I think we’re kind of all more optimistic now and so, I kind of held off bringing this up, because I wanted to be sensitive to that, but I do think it’s time… And so, I’d like to ask for a salary raise from $52,000 to $57,000."