26 ms·

Agree with you in principle (your previous deal with company A is absolutely none of company B's business) but I would like to challenge you on one point: > I'

Agree with you in principle (your previous deal with company A is absolutely none of company B's business) but I would like to challenge you on one point: > I'm placed at a disadvantage in negotiations if I name a number first. ... This is unlikely to be true. Generally, in price negotiations it is advantageous to name a number first. This is known as anchoring and basically the theory is that the end result is better for you if the company has to wheedle you down from 170k than if they anchor the price at 100k and you have to argue them up from there. Plus, it saves a lot of wasted negotiation time on both sides if your price is just way too high for the company and this is clear from the beginning. (edit: I'm talking about expected salary in general, not disclosing your current salary level)

vidarh 10y ago
Note that this assumes your information about your market value is at least roughly in line with their information about your market value. If there's a big discrepancy in what you believe you're worth, then the benefit can easily flip the other way.
alistairSH 10y ago
The parent is discussing prior salaries. You are discussing requested salaries. If specifically asked "What is your current salary?" you would typically respond with the actual current salary, not your ideal new salary.
- vidarh 10y ago
  In this case the prior salary is used for anchoring purposes, by the expectation that the new salary should not be too much higher than the old salary. They're basically using it as a means to sanity check and calibrate their own assessment.
  - sprafa 10y ago
    The thing you might leave a job because you really, really disagree with that assesment!
  - rhizome 10y ago
    by the expectation that the new salary should not be too much higher than the old salary From where does this expectation derive, and what makes it a good barometer of sanity? On the face it just sounds like the same rationale used for basing raises on percentage of an employee's initial salary. "3% over your last job" is not fair.
    - vidarh 10y ago
      The expectation derives from peoples lack of knowledge of what they're worth. It has nothing to do with fairness - it's about what they think they can get away with offering. Based on experience, almost nobody negotiates their offers, and if you see people talking about their job moves, people are often excited about, say, a 10% increase. That's why employers expect to be able to get away with anchoring it to your current salary.
  - vkou 10y ago
    My first job paid me $25,000 CAD a year. My next job paid me $90,000 CAD a year. (Investment bank) My next job paid me $160,000 USD a year. (Google) All numbers are all-in comp. All junior dev roles. Should the bank, and Google have offered me $33,000 and $40,000, so that the new salary isn't too much higher then the old one? Would that satisfy your notion of fairness? When new grads hired by the latter are getting paid $150,000/year? You are hired to do your new job, not the old one. What the old one paid has no relevance.
    - product50 10y ago
      What if you are current job pays you $400k? In that doesn't it advantage you to talk about your current salary to set an anchor? Also, it helps you avoid jobs/positions who are way below that number.
      - papabrown 10y ago
        If your current job pays $400K they are either grossly overpaying or you are in a very narrow band of people in your field and you probably should not be taking too many interviews with people who do not already know what they should be prepared to pay. People at $400K a year don't apply for a job, they're recruited. Any of the problems mentioned in this thread would likely not apply.
        vkou 10y ago
        Or you have the right pedigree, and are working like a horse for a NYC financial firm. Or you are a staff engineer at a SV megacorp.
      - vkou 10y ago
        It does, and there is no law against telling your employer your salary expectations.
    - vidarh 10y ago
      I did not defend the practice. I explained why they are asking. It has nothing to do with fairness, and everything to do with employers using it as a negotiating tactic. In other words: If you don't know what you're worth, of course they won't give you what you're worth.
- louisswiss 10y ago
  I qualified my comment by stating that I agree with the parent as far as current salaries go, yet that in the general case of salary expectation discussions it is nevertheless a better strategy to state a number first. IMO it isn't clear from the parent that they believe it is a good idea to disclose any number first (whether expected or current salary). BTW, if specifically asked 'what is your current salary?' I would typically respond with 'my ideal new salary is $X'
- papabrown 10y ago
  I would rather talk what my salary expectations are rather than my current salary. Not because I'm underpaid but because salary is a very specific term and doesn't take into account many other factors. For instance, I think the worst bonus I've ever received with my current employer is 15%. Best was 30% or so. That's not salary. But it's fairly reliable. With the new employer the bonus might not be reliable even if it's comparable percentage-wise. Every company has different criteria they use to fund the bonus pool and it's unheard of for a potential employer to ever disclose that. Everyone at my current employer gets paid out of the same bonus pool as the CEO so I know we're getting paid :-) Also, equity (at least in my case) plays a huge role. The last few years I've made as much or more in selling vested stock options as I did in salary. So if someone were to ask me what my current salary is in a employment negotiation I would tell them that I don't think it's relevant and give them a few examples why. I would however, tell them what I thought I was worth and justify it by explaining what value I could bring AND-OR I would tell them what salary range I've already been offered elsewhere recently and ask if they were prepared to make an offer in that range. If they insisted my current salary, I pretty much know that's not the right place for me.
emidln 10y ago
> Plus, it saves a lot of wasted negotiation time on both sides if your price is just way too high for the company and this is clear from the beginning. This. I'm very upfront that if a company can't meet at least a particular dollar amount expected, it's not worth wasting both of our time. This saves a ton of time, and also serves as a nice red flag when a company agrees and then later tries to negotiate down at the last minute (if they're going to penny-pinch at the last minute, things like bonuses and vacation approval are basically never happening).
pmoriarty 10y ago
I never consider interviewing and negotiations a waste of time. It's very valuable practice, no matter what the outcome. Practice is how I get better at both. The more interviews I go on and the more times I negotiate salary, the better I get. Also, even if a company can't hire me at the moment due to real budget constraints, they might be able to do so in the future, or perhaps one of the people I interviewed and impressed enough to get to the salary negotiation phase will remember me when they move to another company and want to hire me then. If I name a number way out of their range first, though, they could reject me right off the bat, and I'd never get an interview in the first place, never get the practice, and never get a chance to impress anyone. All of these are worth more to me than the chance of a salary negotiation going sour because I wind up being too expensive. Besides, I'll always have the chance to decide whether I want to work for the company despite them being below my ideal salary. Salary isn't everything. As for anchoring, that might work if you're negotiating with novices, but many employers have professional salary negotiators (either HR or recruiters themselves) who know about anchoring, and they're not going to get fooled by such psychological tricks. If I don't reveal a number first, however, they are forced to name one, and then the ball is in my court, and I can negotiate up from there as I see fit. There's really no downside.
- pm90 10y ago
  > I never consider interviewing and negotiations a waste of time. It's very valuable practice, no matter what the outcome. Practice is how I get better at both. The more interviews I go on and the more times I negotiate salary, the better I get. This. I get the impression that most software devs don't make an effort to learn this incredibly valuable skill. It doesn't even have to be haggling, per se. Just asking for a higher salary is often going to increase it by thousands of dollars. It just boggles my mind at how so many people will leave so much money at the table...
  - collyw 10y ago
    Whenever I have done that its been a "we can't right now" for such and such reason, have some extra responsibilities instead and make it feel like a promotion. It been easier to get another job with more pay.
jnwatson 10y ago
Anchoring only works if the potential employer is ready to buy. Many, many organizations will simply use the number as yet another filter, and you won't even begin discussions. By giving a number first, you're either too high and you won't have an opportunity to sell yourself, you're too low and you've literally already negotiated against yourself, or you're lucky and right at their expectation, which you could have gotten to by simply not giving the first number. I do agree with the wasted negotiating time thing.
- pc86 10y ago
  This is why we publish salary ranges with our job ads but also require a desired salary within that range from candidates.
  - sheeshkebab 10y ago
    That's how us government jobs work too :)
    - pc86 10y ago
      Unfortunately the negatives around government jobs far outweigh the benefits of having the salary a known quantity when you are applying.
  - sitkack 10y ago
    If only the rest of the industry was so mature.
  - davemel37 10y ago
    Every time I ever tried this, the candidates hover around the top of the range regardless of qualification and experience.
    - jjnoakes 10y ago
      Which is fine; if you can argue that their experience may not merit top of the range, you just negotiate down a bit...
VT_Drew 10y ago
>Generally, in price negotiations it is advantageous to name a number first. This is absolutely 100% wrong. In price negotiations you will almost always fair better if you force the other party to bring up a number first.
- louisswiss 10y ago
  Source? There is a large body of research which disagrees with you... Oechssler, Jörg; Roider, Andreas; Schmitz, Patrick W. (2009). "Cognitive abilities and behavioral biases". Journal of Economic Behavior & Organization. 72 (1): 147–152. doi:10.1016/j.jebo.2009.04.018. Jump up ^ Orr, D. & Guthrie, C. (2005). "Anchoring, information, expertise, and negotiation: New insights from meta-analysis". Ohio St. J. Disp. Resol., 597, 21. SSRN 900152 Jump up ^ Kristensen, Henrik; Gärling, Tommy (1997). "The Effects of Anchor Points and Reference Points on Negotiation Process and Outcome". Organizational Behavior and Human Decision Processes. 71 (1): 85–94. doi:10.1006/obhd.1997.2713. (edit as I can't reply to the child comment: Yes, you're right of course. Put it down to a mix of multitasking, iphone browser and university-instilled fear of using Wikipedia as a source)
  - always_good 10y ago
    Citation soup doesn't really add anything to a discussion. Why not link to the Wiki article you copied the sources from? https://en.wikipedia.org/wiki/Anchoring https://en.wikipedia.org/wiki/Anchoring
  - VT_Drew 10y ago
    Source right here: http://www.kalzumeus.com/2012/01/23/salary-negotiation/ http://www.kalzumeus.com/2012/01/23/salary-negotiation/ (and it isn't a wikipedia article)
- enraged_camel 10y ago
  Exactly. Whoever names a number first puts themselves at a significant disadvantage.
  - 10y ago
pc86 10y ago
Anchoring only works in this way if there's no definitive market value for what you're selling. I know what a software architect commands in my geographic area. If you come in asking for 1.8x that, you're off the table as a candidate immediately (which you mention in the next point). No amount of anchoring will change that.
- louisswiss 10y ago
  Agreed. More likely, however, a software architect commands a range of salaries in your area (eg 80-130k with a few outliers either side). As an 'average' performer in this scenario, you would do well to anchor your 'value' at 120k and let them make excuses why 105k is more reasonable. The alternative (let them anchor you at 90k and then you have to explain to the recruiter why you are worth 15k more) will be trickier in most cases.
Spooky23 10y ago
In places that don't use salary bands, many companies will hit you with previous salary + 10%. In one place that I worked at, salary for a common technical job title (n=100) varied by 50%. The mechanics were pretty obvious. People who worked their way up got screwed with the 10% raise bullshit, and people who came in through some other means were able to extract higher salaries. Where I find this stuff annoying is where there is no signal about the salary level. One placed I spoke to many years ago was advertising for a position that was probably worth $100-105k in the market, but they were hiring at $50k.
komali2 10y ago
I think you're confusing two sales concepts - first to talk, and anchoring. Anchoring is a more general marketing concept that works well in advertisements (crossing out a black $280 and putting a red $100 underneath it). Anchoring doesn't work so well for something much more fluid (and with much more at stake) such as a salary negotiation. In-person sales meetings (which is what an interview is, for both sides) are where "first to talk" come into play. It's a concept as old as war meetings between opposing roman generals. First to talk loses, period. Why? I don't know, but years of sales and recruitment has taught me that whoever slips is going to give the advantage to the other side of the table. You can only hurt yourself by giving a number. The company has set a budget, either you fit or you don't. Maybe the budget is higher than you expected and you take the job for way more than you would have asked for. Maybe it's less and you don't take the job. The key point is that company is not the only company you are dealing with - you can move on to another. And another and another, and as long as you don't give your number, you will win out. I can't share this data but when I worked at a bootcamp our analysis showed this as well. Students that gave their number got paid less. There's a big push for bootcamp transparency so hopefully that sort of info will get published soon.
- deleted 10y ago
  [deleted]
- Pyxl101 10y ago
  Completely agree that giving previous comp information or comp expectations can only hurt you as an employee. The only thing giving this information will do is provide a company the information they need to pay you less than they might have otherwise. I think it is difficult for employees to judge what they're truly worth. Therefore, when most people give a number, that number will be lower than what an employer may be willing to pay (and perhaps lower than the company's initial offer would be). I would guess this holds doubly true for graduates of a bootcamp, or recent college graduates, who have less industry experience on which to base their judgment of business value.
- siliconc0w 10y ago
  The problem is that most companies won't provide an offer until you've gone through interviews which are expensive for both parties. So this reasoning holds if you have an abundance of time, but you can generally figure out what their likely range is going to be. Do research, ask colleagues, etc. Anchor at the high end of that - you can also leave it vague by talking about 'total comp' which can includes subjective things like equity, location, vacation, etc. You may loose some value by doing this but it'll also mean you won't waste time and so you'll only be interviewing in places that are in your ballpark.
ufmace 10y ago
I disagree that it's to your advantage to try to anchor to a high number early on. The reason IMO is that, at the beginning of a negotiation, neither party knows much about the other. They don't know enough about you to know whether it would be worth paying you that much, and you don't know enough about them to know if you'd be willing to work for them for that much. Start naming numbers at the beginning, and both sides will name extreme numbers to play it safe, they'll be far apart, and no deal gets made if they both stick to those numbers. Let them see what you can do for them, and let them show you what it's like to work for them, then you should find it easier to come to an agreement on a number.
Overtonwindow 10y ago
Anchoring fails because let's say the position is wanting to hire someone at $70k and you state an expected salary of $75 - 80k, negotiable. That employer may decide it's not worth their time because you'll want too much, so why bother with even calling you in for an interview. Asking for a salary number from applicants up front is not just a way to undercut them, but it's a way to quickly weed out and only interview those who are willing to take bottom dollar.
- taurath 10y ago
  They get the talent and experience they are willing to pay for, and deal with the recidivism rate that paying under market gets you.
throwaway91111 10y ago
That isn't banned by this law, though.
nebari 10y ago
Your points are valid if we're talking about a neutral salary negotiation, i.e., prospective employer asks, "What salary range are you seeking?" In this case, however, the disadvantage comes from a fixed number - your previous salary - not what you'd like. In a situation where you were underpaid, declaring your previous salary will definitely put you at a negotiating disadvantage.
pfarnsworth 10y ago
You're absolutely wrong. You're negotiating from a position of weaker information. You have no idea what the other engineers are being paid, all you know is how much you're being paid, and what you would like to be paid. Meanwhile the recruiter/hiring manager knows exactly how much they are paying all the other engineers. You are now tasked with trying to get as fair/high a salary as possible, without knowing what their threshold is for simply no longer continuing the negotiations, because as you said "the price is just way too high". By hearing the other side first, you can then gauge whether or not your desired salary is acceptable, or you can try to negotiate up.
OrwellianChild 10y ago
The problem I have with this approach is that with many companies, particularly larger established ones like AmaGoogSoft, base salary is just one portion of a compensation package that might have contributions of up to 50% from stock, bonus, incentive pay, benefits/matching, and perks. If you start anchoring on one piece of that puzzle, it limits your ability to move on others. If the goal of negotiation is to maximize your total offer (which it should be), then the only reasonable answer to the question is "depends on total compensation factors".

vidarh 10y ago

Note that this assumes your information about your market value is at least roughly in line with their information about your market value. If there's a big discrepancy in what you believe you're worth, then the benefit can easily flip the other way.

alistairSH 10y ago

The parent is discussing prior salaries. You are discussing requested salaries. If specifically asked "What is your current salary?" you would typically respond with the actual current salary, not your ideal new salary.

vidarh 10y ago
In this case the prior salary is used for anchoring purposes, by the expectation that the new salary should not be too much higher than the old salary. They're basically using it as a means to sanity check and calibrate their own assessment.
- sprafa 10y ago
  The thing you might leave a job because you really, really disagree with that assesment!
- rhizome 10y ago
  by the expectation that the new salary should not be too much higher than the old salary From where does this expectation derive, and what makes it a good barometer of sanity? On the face it just sounds like the same rationale used for basing raises on percentage of an employee's initial salary. "3% over your last job" is not fair.
  - vidarh 10y ago
    The expectation derives from peoples lack of knowledge of what they're worth. It has nothing to do with fairness - it's about what they think they can get away with offering. Based on experience, almost nobody negotiates their offers, and if you see people talking about their job moves, people are often excited about, say, a 10% increase. That's why employers expect to be able to get away with anchoring it to your current salary.
- vkou 10y ago
  My first job paid me $25,000 CAD a year. My next job paid me $90,000 CAD a year. (Investment bank) My next job paid me $160,000 USD a year. (Google) All numbers are all-in comp. All junior dev roles. Should the bank, and Google have offered me $33,000 and $40,000, so that the new salary isn't too much higher then the old one? Would that satisfy your notion of fairness? When new grads hired by the latter are getting paid $150,000/year? You are hired to do your new job, not the old one. What the old one paid has no relevance.
  - product50 10y ago
    What if you are current job pays you $400k? In that doesn't it advantage you to talk about your current salary to set an anchor? Also, it helps you avoid jobs/positions who are way below that number.
    - papabrown 10y ago
      If your current job pays $400K they are either grossly overpaying or you are in a very narrow band of people in your field and you probably should not be taking too many interviews with people who do not already know what they should be prepared to pay. People at $400K a year don't apply for a job, they're recruited. Any of the problems mentioned in this thread would likely not apply.
      - vkou 10y ago
        Or you have the right pedigree, and are working like a horse for a NYC financial firm. Or you are a staff engineer at a SV megacorp.
    - vkou 10y ago
      It does, and there is no law against telling your employer your salary expectations.
  - vidarh 10y ago
    I did not defend the practice. I explained why they are asking. It has nothing to do with fairness, and everything to do with employers using it as a negotiating tactic. In other words: If you don't know what you're worth, of course they won't give you what you're worth.
louisswiss 10y ago
I qualified my comment by stating that I agree with the parent as far as current salaries go, yet that in the general case of salary expectation discussions it is nevertheless a better strategy to state a number first. IMO it isn't clear from the parent that they believe it is a good idea to disclose any number first (whether expected or current salary). BTW, if specifically asked 'what is your current salary?' I would typically respond with 'my ideal new salary is $X'
papabrown 10y ago
I would rather talk what my salary expectations are rather than my current salary. Not because I'm underpaid but because salary is a very specific term and doesn't take into account many other factors. For instance, I think the worst bonus I've ever received with my current employer is 15%. Best was 30% or so. That's not salary. But it's fairly reliable. With the new employer the bonus might not be reliable even if it's comparable percentage-wise. Every company has different criteria they use to fund the bonus pool and it's unheard of for a potential employer to ever disclose that. Everyone at my current employer gets paid out of the same bonus pool as the CEO so I know we're getting paid :-) Also, equity (at least in my case) plays a huge role. The last few years I've made as much or more in selling vested stock options as I did in salary. So if someone were to ask me what my current salary is in a employment negotiation I would tell them that I don't think it's relevant and give them a few examples why. I would however, tell them what I thought I was worth and justify it by explaining what value I could bring AND-OR I would tell them what salary range I've already been offered elsewhere recently and ask if they were prepared to make an offer in that range. If they insisted my current salary, I pretty much know that's not the right place for me.

emidln 10y ago

> Plus, it saves a lot of wasted negotiation time on both sides if your price is just way too high for the company and this is clear from the beginning. This. I'm very upfront that if a company can't meet at least a particular dollar amount expected, it's not worth wasting both of our time. This saves a ton of time, and also serves as a nice red flag when a company agrees and then later tries to negotiate down at the last minute (if they're going to penny-pinch at the last minute, things like bonuses and vacation approval are basically never happening).

pmoriarty 10y ago

I never consider interviewing and negotiations a waste of time. It's very valuable practice, no matter what the outcome. Practice is how I get better at both. The more interviews I go on and the more times I negotiate salary, the better I get. Also, even if a company can't hire me at the moment due to real budget constraints, they might be able to do so in the future, or perhaps one of the people I interviewed and impressed enough to get to the salary negotiation phase will remember me when they move to another company and want to hire me then. If I name a number way out of their range first, though, they could reject me right off the bat, and I'd never get an interview in the first place, never get the practice, and never get a chance to impress anyone. All of these are worth more to me than the chance of a salary negotiation going sour because I wind up being too expensive. Besides, I'll always have the chance to decide whether I want to work for the company despite them being below my ideal salary. Salary isn't everything. As for anchoring, that might work if you're negotiating with novices, but many employers have professional salary negotiators (either HR or recruiters themselves) who know about anchoring, and they're not going to get fooled by such psychological tricks. If I don't reveal a number first, however, they are forced to name one, and then the ball is in my court, and I can negotiate up from there as I see fit. There's really no downside.

pm90 10y ago
> I never consider interviewing and negotiations a waste of time. It's very valuable practice, no matter what the outcome. Practice is how I get better at both. The more interviews I go on and the more times I negotiate salary, the better I get. This. I get the impression that most software devs don't make an effort to learn this incredibly valuable skill. It doesn't even have to be haggling, per se. Just asking for a higher salary is often going to increase it by thousands of dollars. It just boggles my mind at how so many people will leave so much money at the table...
- collyw 10y ago
  Whenever I have done that its been a "we can't right now" for such and such reason, have some extra responsibilities instead and make it feel like a promotion. It been easier to get another job with more pay.

jnwatson 10y ago

Anchoring only works if the potential employer is ready to buy. Many, many organizations will simply use the number as yet another filter, and you won't even begin discussions. By giving a number first, you're either too high and you won't have an opportunity to sell yourself, you're too low and you've literally already negotiated against yourself, or you're lucky and right at their expectation, which you could have gotten to by simply not giving the first number. I do agree with the wasted negotiating time thing.

pc86 10y ago
This is why we publish salary ranges with our job ads but also require a desired salary within that range from candidates.
- sheeshkebab 10y ago
  That's how us government jobs work too :)
  - pc86 10y ago
    Unfortunately the negatives around government jobs far outweigh the benefits of having the salary a known quantity when you are applying.
- sitkack 10y ago
  If only the rest of the industry was so mature.
- davemel37 10y ago
  Every time I ever tried this, the candidates hover around the top of the range regardless of qualification and experience.
  - jjnoakes 10y ago
    Which is fine; if you can argue that their experience may not merit top of the range, you just negotiate down a bit...

VT_Drew 10y ago

>Generally, in price negotiations it is advantageous to name a number first. This is absolutely 100% wrong. In price negotiations you will almost always fair better if you force the other party to bring up a number first.

louisswiss 10y ago
Source? There is a large body of research which disagrees with you... Oechssler, Jörg; Roider, Andreas; Schmitz, Patrick W. (2009). "Cognitive abilities and behavioral biases". Journal of Economic Behavior & Organization. 72 (1): 147–152. doi:10.1016/j.jebo.2009.04.018. Jump up ^ Orr, D. & Guthrie, C. (2005). "Anchoring, information, expertise, and negotiation: New insights from meta-analysis". Ohio St. J. Disp. Resol., 597, 21. SSRN 900152 Jump up ^ Kristensen, Henrik; Gärling, Tommy (1997). "The Effects of Anchor Points and Reference Points on Negotiation Process and Outcome". Organizational Behavior and Human Decision Processes. 71 (1): 85–94. doi:10.1006/obhd.1997.2713. (edit as I can't reply to the child comment: Yes, you're right of course. Put it down to a mix of multitasking, iphone browser and university-instilled fear of using Wikipedia as a source)
- always_good 10y ago
  Citation soup doesn't really add anything to a discussion. Why not link to the Wiki article you copied the sources from? https://en.wikipedia.org/wiki/Anchoring https://en.wikipedia.org/wiki/Anchoring
- VT_Drew 10y ago
  Source right here: http://www.kalzumeus.com/2012/01/23/salary-negotiation/ http://www.kalzumeus.com/2012/01/23/salary-negotiation/ (and it isn't a wikipedia article)
enraged_camel 10y ago
Exactly. Whoever names a number first puts themselves at a significant disadvantage.
- 10y ago

pc86 10y ago

Anchoring only works in this way if there's no definitive market value for what you're selling. I know what a software architect commands in my geographic area. If you come in asking for 1.8x that, you're off the table as a candidate immediately (which you mention in the next point). No amount of anchoring will change that.

louisswiss 10y ago
Agreed. More likely, however, a software architect commands a range of salaries in your area (eg 80-130k with a few outliers either side). As an 'average' performer in this scenario, you would do well to anchor your 'value' at 120k and let them make excuses why 105k is more reasonable. The alternative (let them anchor you at 90k and then you have to explain to the recruiter why you are worth 15k more) will be trickier in most cases.

Spooky23 10y ago

In places that don't use salary bands, many companies will hit you with previous salary + 10%. In one place that I worked at, salary for a common technical job title (n=100) varied by 50%. The mechanics were pretty obvious. People who worked their way up got screwed with the 10% raise bullshit, and people who came in through some other means were able to extract higher salaries. Where I find this stuff annoying is where there is no signal about the salary level. One placed I spoke to many years ago was advertising for a position that was probably worth $100-105k in the market, but they were hiring at $50k.

komali2 10y ago

I think you're confusing two sales concepts - first to talk, and anchoring. Anchoring is a more general marketing concept that works well in advertisements (crossing out a black $280 and putting a red $100 underneath it). Anchoring doesn't work so well for something much more fluid (and with much more at stake) such as a salary negotiation. In-person sales meetings (which is what an interview is, for both sides) are where "first to talk" come into play. It's a concept as old as war meetings between opposing roman generals. First to talk loses, period. Why? I don't know, but years of sales and recruitment has taught me that whoever slips is going to give the advantage to the other side of the table. You can only hurt yourself by giving a number. The company has set a budget, either you fit or you don't. Maybe the budget is higher than you expected and you take the job for way more than you would have asked for. Maybe it's less and you don't take the job. The key point is that company is not the only company you are dealing with - you can move on to another. And another and another, and as long as you don't give your number, you will win out. I can't share this data but when I worked at a bootcamp our analysis showed this as well. Students that gave their number got paid less. There's a big push for bootcamp transparency so hopefully that sort of info will get published soon.

deleted 10y ago
[deleted]
Pyxl101 10y ago
Completely agree that giving previous comp information or comp expectations can only hurt you as an employee. The only thing giving this information will do is provide a company the information they need to pay you less than they might have otherwise. I think it is difficult for employees to judge what they're truly worth. Therefore, when most people give a number, that number will be lower than what an employer may be willing to pay (and perhaps lower than the company's initial offer would be). I would guess this holds doubly true for graduates of a bootcamp, or recent college graduates, who have less industry experience on which to base their judgment of business value.
siliconc0w 10y ago
The problem is that most companies won't provide an offer until you've gone through interviews which are expensive for both parties. So this reasoning holds if you have an abundance of time, but you can generally figure out what their likely range is going to be. Do research, ask colleagues, etc. Anchor at the high end of that - you can also leave it vague by talking about 'total comp' which can includes subjective things like equity, location, vacation, etc. You may loose some value by doing this but it'll also mean you won't waste time and so you'll only be interviewing in places that are in your ballpark.

ufmace 10y ago

I disagree that it's to your advantage to try to anchor to a high number early on. The reason IMO is that, at the beginning of a negotiation, neither party knows much about the other. They don't know enough about you to know whether it would be worth paying you that much, and you don't know enough about them to know if you'd be willing to work for them for that much. Start naming numbers at the beginning, and both sides will name extreme numbers to play it safe, they'll be far apart, and no deal gets made if they both stick to those numbers. Let them see what you can do for them, and let them show you what it's like to work for them, then you should find it easier to come to an agreement on a number.

Overtonwindow 10y ago

Anchoring fails because let's say the position is wanting to hire someone at $70k and you state an expected salary of $75 - 80k, negotiable. That employer may decide it's not worth their time because you'll want too much, so why bother with even calling you in for an interview. Asking for a salary number from applicants up front is not just a way to undercut them, but it's a way to quickly weed out and only interview those who are willing to take bottom dollar.

taurath 10y ago
They get the talent and experience they are willing to pay for, and deal with the recidivism rate that paying under market gets you.

throwaway91111 10y ago

That isn't banned by this law, though.

nebari 10y ago

Your points are valid if we're talking about a neutral salary negotiation, i.e., prospective employer asks, "What salary range are you seeking?" In this case, however, the disadvantage comes from a fixed number - your previous salary - not what you'd like. In a situation where you were underpaid, declaring your previous salary will definitely put you at a negotiating disadvantage.

pfarnsworth 10y ago

You're absolutely wrong. You're negotiating from a position of weaker information. You have no idea what the other engineers are being paid, all you know is how much you're being paid, and what you would like to be paid. Meanwhile the recruiter/hiring manager knows exactly how much they are paying all the other engineers. You are now tasked with trying to get as fair/high a salary as possible, without knowing what their threshold is for simply no longer continuing the negotiations, because as you said "the price is just way too high". By hearing the other side first, you can then gauge whether or not your desired salary is acceptable, or you can try to negotiate up.

OrwellianChild 10y ago

The problem I have with this approach is that with many companies, particularly larger established ones like AmaGoogSoft, base salary is just one portion of a compensation package that might have contributions of up to 50% from stock, bonus, incentive pay, benefits/matching, and perks. If you start anchoring on one piece of that puzzle, it limits your ability to move on others. If the goal of negotiation is to maximize your total offer (which it should be), then the only reasonable answer to the question is "depends on total compensation factors".