No one likes to be asked what their desired salary is. Frankly, the question is difficult to answer. How do you know what your fair compensation is, when there isn’t a standard formula?
A universal formula would be nice, but there are too many factors that go into compensation. Years of experience is a quick guideline everybody is familiar with. But what else goes into factoring your fair market value?
Technical Skills
Take professional development seriously! Utilizing every chance you get to develop new skills and experiences will quickly pay off when it comes time to look for new opportunities.
Do some research in your current industry. Do some LinkedIn searching. What are others in your city and industry doing? Because we recruit in the digital marketing space, we’ll use that industry as an example. Candidates with experience in Google Analytics and paid ads tend to be compensated more than someone lacking those skills.
To make yourself more marketable, push your boundaries and learn new skills. There is an abundance of certifications out there. Having professional certifications demonstrates your willingness to learn and grow, as well as a mastery of said tools. Companies like to see what you can bring to the table. The more technical experiences you gain, the more you can ask for in terms of salary.
Location, Location, Location
Where you live still impacts your market value. COVID, the news and social media has sent this into a small (or maybe large) tailspin. The wage discrepancy is louder than ever. Some companies are now paying New York salaries regardless of where you’re located.
That being said, in general, we see smaller towns and cities often pay less than the same position in a larger city. Thinking through this, it makes sense that the compensation doesn’t align. Larger cities tend to have a higher cost of living.
This is where specific market research matters. What are people in your city making? What functions are they performing at work and how does that align with your experience? Good gauges of compensation are your coworkers and previous colleagues. They tend to be performing similar roles as you in the same location.
Company Size
A New York salary sounds amazing, right? I mean who does not want to make well over market value? It is important to realize that the companies paying this salary tend to be large corporations.
Large companies have the budget to spend on their employees. This has not changed due to the pandemic. You’ll find that these positions can be rigid. You perform the same day-to-day functions within a more structured environment.
Small companies, on the other hand, have tighter budgets. They cannot keep up with the New York salary trend. While this may sound like a negative, salary isn’t everything. They often offer a wide variety of experiences and the opportunity to wear many hats. Somewhere in the middle, between traditional large and small companies, are well-funded start-ups. They function much like small companies, where you’ll wear many hats, but have the budget to pay higher salaries.
This knowledge comes in handy when negotiating your salary (remember technical skills allow you to negotiate more compensation). You should identify which company size aligns with your values and goals. In addition, remember to consider all benefits, not just salary alone.
Supply and Demand
COVID has shown us that supply and demand can drastically control wages (among other things). When there are too many open positions and not enough candidates, companies tend to pay more to fill these roles. In a time when everyone left their current positions to assume new roles, companies increased pay as an incentive to work for them.
On the other hand, when there are too many people looking for a small number of open positions, it can have the opposite effect than mentioned above. This can drive the salary down. The workforce and companies operate like a traditional supply and demand curve. The market salary is found where the two can intersect.
Other Factors to Consider
Other factors to consider are years of experience and the type of experience you’ve attained. Years of experience will usually trump a certification without experience. For example, you have one applicant with 3 years of experience in Google Ads. This applicant does not have the Google Ads certification, but will most likely receive the position when compared to a candidate with the Google Ads certification and no experience.
This is not to say that certifications are meaningless. When applying for entry level positions or looking to step into a higher role, certifications may be just the thing to get your foot in the door. Companies will consider a candidate that lacks direct experience if the candidate has an open mindset and a willingness to learn.
In addition, the types of experiences you gain in your previous positions have an impact on your salary. For example, someone with multiple direct reports can be paid more than someone without direct reports. It is important to note that these experiences can happen in your current role. Ask for more responsibility and open yourself up to different learning opportunities.
There are some additional resources to help you in your salary research. Check out websites like LinkedIn, Indeed, payscale and The Bureau of Labor Statistics to find your appropriate salary. Remember to look at different sources and compare and contrast their driving factors. Be sure to understand the nuances that put you on the lower or higher end of the scale.
Use a variety of websites in your research and be sure to include all factors of compensation. If you’re struggling to find your market value, schedule a consultation with us! We’d be happy to talk through compensation and market trends or help you find your next position.