Wondering what you are worth? Chances are, you have a figure in mind, but this figure may not be accurate according to market standards. Salary is a funny thing: taboo to talk about, often attached to an individual’s self regard, required to maintain a certain standard of living, but dictated by the forces of the market, the company, and the region in which you live.
So how do you calculate an accurate salary range for yourself? It is not a simple calculation, but here are a few items to consider when determining your desired salary:
Honestly Assess Yourself. Take into consideration how many years experience you have, your current position, what companies you’ve worked for (have you worked for large, publicly traded companies or small, mom-and-pop shops), career progression (have you had five promotions in five years, or been in the same position for ten?), accreditations (are you a CPA or a top 20 MBA?), direct reports (do you supervise five people or no one?) and, of course, current salary. Whether or not you are currently employed plays a factor as well, as an employed individual typically has more leverage than one who is not. Remember, no single factor can determine a fair wage; instead it is a combination of your previous experience, qualifications, and skills that really determine what salary you will be offered.
[See our article on The Offer: Thinking it Over]
Do Your Research. Consider the many factors you must look at when determining salary, including geography (do you live in San Francisco or Denver?), industry (is it growing, or consolidating?), company size (are you interviewing with a $100M company, or a $1M company?), job title, and the current market.
These are the types of questions you want to ask yourself: are you interviewing to be a Controller of a $200M publically traded Software Company in the Silicon Valley or are you interested in becoming the Controller at a privately owned Oil & Gas company in Denver? Are you looking for a position as a Financial Analyst at an established tech company in Boulder, CO or at a hot new Social Media company South of Market in San Francisco? Be realistic in your assessment of who you are and what positions you are looking at and you will be able to determine a realistic salary, without making judgments based solely on what you would like to make.
[See our article on Countering the Offer]
You should also get the input of a few trusted advisors. Call a trusted friend who works in the same industry. You don’t necessarily have to ask him his salary; you can just talk about general numbers and expectations to get his take on your situation. Talking to a trusted recruiter is another good option, especially one who works in your industry and geographic region. She should be very well versed in the salaries in your field, and all the nuances that go along with calculating salaries.
Lastly, some career experts, such as Alison Green, blogger and career columnist for US News & World Report, recommend taking on the role of researcher and calling competitor’s firms to speak with their HR departments about salary ranges they pay for the same or similar positions. Just tell them that you are conducting salary research and would like to get some information on compensation within their firm.
While companies view salaries as an immediate chip off their bottom line, calculating these salaries is really more of an art than a science. But if you follow the above advice, you should be able to turn that art into a hard and fast number that will make both you and the company you are interviewing with happy.