With a recession looming, how can you negotiate a better salary?

Studies show women can be penalized when they negotiate for higher
compensation, so they often ‘just choose not to.’
Violeta Stoimenova/iStock

Women can find all sorts of ways to talk themselves out of negotiating their salaries.

Reasons might include external factors such as a looming recession or market pressure, or internal factors such as not wanting to rock the boat with management. Women may tell themselves the timing isn’t right or they’re lucky to just have a job. Jillian Climie has seen it all. As co-founder of The Thoughtful Co. in Vancouver, Ms. Climie has spent her career advising and leading teams in executive compensation and corporate governance.

“I’ve seen so many successful, intelligent, strategic women at all levels not negotiating their compensation at really key points in their career,” Ms. Climie says. “We’re not socialized to ask for what we want and ask for what we need in an employment relationship.”

Studies from Harvard University and Carnegie Mellon University found that women were penalized when they attempted to negotiate for higher compensation. Research suggests encouraging women to negotiate more and differently often backfires, and 20 per cent of women never negotiate at all.

The costs of being assertive

“As women in the workplace, we’re expected to be nice and agreeable… and that impacts how our performance is assessed,” Ms. Climie says. “But then at the same time, to be seen as competent as a leader, we have to be assertive.”

She notes that balancing these conflicting demands is a near-impossible feat.

“I find so many women don’t want to use up their social capital and be more assertive in negotiations. So, they just choose not to,” she says.

Carla Fehr, associate professor of philosophy and Wolfe Chair in Scientific and Technological Literacy at the University of Waterloo, says that negotiating a better salary can put women on a tight rope – they need to be self-promoting and assertive yet risk being judged harshly as a result.

“When men forcefully assert and promote themselves, we use words like confident and leadership,” Dr. Fehr says. “And when women do that, we have an entirely different and much less polite set of words that we use to describe them.”

She notes that while it’s true that sometimes women are more hesitant to ask for better compensation, “what that ignores is the fact that when women are assertive, we’re seen as being less likeable, less of a team player. There are costs that go with just being assertive. So, women might be less likely to ask, but that can be an adaptive kind of situation.”

Preparation before negotiation

Negotiation isn’t just one conversation and then you walk out disappointed, says Loren Falkenberg, senior associate dean at the Haskayne School of Business at the University of Calgary. It’s a series of conversations.

“A negotiation shouldn’t be a persuasion, it should be an exchange of information,” Dr. Falkenberg says. “If you view it as a persuasion, you don’t learn very much about the other party.”

Dr. Falkenberg suggests that women prepare for salary negotiations by going in with a list of questions in order to understand what fair compensation means at the organization and gain more power to negotiate. Think about the factors that will influence your company in the next five years, she says. Find out what the company’s priorities are and consider how they might align with your priorities.

“You’re trying to set yourself up to say [to your employer], ‘I can help you [achieve] your five-year goals,’” Dr. Falkenberg says. “That’s really what you’re trying to say to somebody when you want a pay increase.”

She also suggests tapping into your network to find out other people’s salary ranges so you will have a good base for comparison.

“What are other people making? How is their work similar to the work that you are doing or the work that you would do in the future?” she says.

Once you have collected the information you need, build a case. Think about the value you add to your companies and key metrics – those non-negotiable facts about performance. It’s useful to use hard data and numbers to quantify accomplishments and specify contributions, says Dr. Falkenberg. Bring documentation or evidence that proves the value of your work.

If a salary is non-negotiable, there are lots of other pieces that could be negotiated, Ms. Climie says. This could include bonuses, equity, vacation time, learning and development, allowances, sabbaticals, perks, travel or car allowances and flexible work arrangements.

Know your worth

With a moderate recession predicted for 2023, it is in companies’ best interests to retain excellent women, Dr. Fehr says. That means not just hiring them but keeping them around.

Dr. Fehr notes that while the gender pay gap can be dismaying, particularly in STEM and other areas where women have historically been underrepresented, she recently realized that there is an important silver lining for women coming up today.

“[Women] deserve to be paid more than they’re being paid. They’re more qualified than they ever thought they were. And for me, knowing this helps me gather the confidence that I need to ask for what I want,” she says.

“If I’m mentoring a woman, my message for her is you’re better than you think you are because you have jumped over higher hurdles without even knowing it. So, ask for what you deserve.”

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