3 days ago
A short guide to salary negotiations
Talking about how much money you earn is uncomfortable for many people. But there are moments when it is an unavoidable topic of conversation. When you take a new job or learn how much your raise will be for the coming year, you have to talk about salaries. You also have to make a decision about whether to negotiate for more.
Negotiating does seem to pay off, at least in monetary terms. In its 2025 survey of American jobseekers, Employ, a recruiting-software provider, found that 37% of candidates had asked for more money, and that 80% of them had got more than their initial offer. That is consistent with a paper published in 2011 by Michelle Marks of the University of Colorado and Crystal Harold of Temple University, which found that candidates who chose to bargain bumped up their starting salaries by an average of $5,000 ($7,160 in today's money).
Negotiating, which is the subject of this week's episode of our Boss Class podcast, comes more naturally to some than others. A recent study by Jackson Lu of the Massachusetts Institute of Technology looked at 19 consecutive years of MBA graduates from an American business school, and found that graduates of East Asian and South-East Asian ethnicity had markedly lower salaries than South Asians and whites. The propensity to negotiate among different groups explains the gap; East Asians and South-East Asians who did not try to negotiate were more likely to say they were concerned about damaging the relationship with an employer.
Women are more likely than men to worry about the effect of negotiating—with some cause. As part of a paper on salary negotiations published in 2024, Francesco Capozza of the Berlin Social Science Centre conducted a survey of HR managers in America. The respondents thought that candidates who attempted to negotiate on pay were less likely to receive a job offer than those who did not, and that this penalty hit women disproportionately hard.
If negotiating both raises salaries and risks a backlash, what is a bargainer to do? Leigh Thompson, who teaches at the Kellogg School of Management at Northwestern University, gives two pieces of advice to her MBA students as they look for work. One is not to start negotiating until you actually have a job offer (further evidence that MBAs may lack many things but confidence isn't one of them). The other is not to turn a negotiation into a bidding war, deliberately playing potential employers off against each other to extract higher offers. Don't be combative, she says. Don't threaten.
Jim Sebenius, who teaches negotiating at Harvard Business School, advises scoping out the role as fully as possible and then finding the market rate for that sort of job. Information on pay is much easier to find than it was, owing to sites such as GlassDoor, and requirements in some places to publish salary ranges for advertised roles.
If candidates can attach themselves to a reasonable principle—that they only want to be paid the going rate—and point to evidence to back up their argument, that is more likely to work than arbitrary numbers, begging or threats to go elsewhere. Even if more money isn't available, other things might be on the table: a promise to review pay after a certain period, named parking bays or whatever floats your boat.
It can be annoying for bosses to hear requests for more money, when all they really want is unbridled enthusiasm. But some employers actively want people to be good at negotiating. Photoroom is a French AI startup that makes photo-editing software; it offers negotiating training to anyone at the firm who wants it. Its primary goal is to enable engineers to buy kit fast without getting lost in red tape; the training helps them to do so at a good price.
Matt Rouif, its boss, says Photoroom also wants to know if it is paying below market rate; it buys in benchmark data on salaries and shares that data with employees so that conversations have a common starting-point. 'A lot of people think it's a fight. We're trying to find the best outcome that looks fair.' That's not a bad way for employees to frame a salary negotiation, either.
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