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Deal or No Deal? How can I get the starting pay I want?

Deal or No Deal? How can I get the starting pay I want?. April 2, 2008 Sally C. McKay Director Human Resources Belmont University. Value of College Degree????. US Census Bureau report 2006, the average gap in salary between those with high school and college degree – almost $20,000.

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Deal or No Deal? How can I get the starting pay I want?

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  1. Deal or No Deal?How can I get the starting pay I want? April 2, 2008 Sally C. McKay Director Human Resources Belmont University

  2. Value of College Degree???? • US Census Bureau report 2006, the average gap in salary between those with high school and college degree – almost $20,000. • Average college grad earns 1.62 times the lifetime earnings of high school grad - $1,189,836 in 2006.

  3. The Value of a College Degree? • US Census Bureau, State of TN – 2006 American Community Survey • Degree levels in Tennessee • 81.8% have high school diploma • 21.5% population have bachelor’s degree • 7.3% population have advanced degree • Average personal income in Tennessee • $24,286 with high school diploma • $40,838 with college degree • $67,986 with graduate or professional degree

  4. How Is My Pay Determined? Job Individual Internal Value Individual Performance External Value Job Value Performance Rating Pay

  5. Internal Value of Job • Depends on size of company - may use formal or informal system to define jobs • Titles do not tell the whole picture • Common factors used to differentiate internal value of jobs within a company: • Scope & Complexity of Job • Financial Impact of Job • Interpersonal Focus / Communications with Customers • Leadership or Supervisory Responsibility • Education / Knowledge / Skills

  6. External Value of Job • What is Market Value of Job? • Companies pay for salary survey data specific to location and industry • Market value differs depending on level of job (experience, education, etc.) • Company philosophy • Pay “at Market” • Pay “above Market” • Pay “below Market”

  7. Belmont Entry Level Professional Jobs(Require College Degree)Nashville Market • Computer Technician - $39,616 • Admissions Counselor = $34,872 • Campus Health Nurse = $49,200 • Accountant = $43,177 • Associate Mgr. Bookstore = $39,250 • Writer/Editor = $48,962 • Graphic Designer = $42,666

  8. Average National Starting Salary Offers New College Grads (bachelor’s degrees)NACE Fall 2007 and Winter 2008

  9. Offers for Business Majors NACE Fall 2007 and Winter 2008

  10. US News and World Report from “31 Top Careers 2008,” posted 12/19/07 • Looks at job satisfaction, training difficulty, prestige and job market outlook. • Curriculum and training specialist = $63,200 • Editor - $56,200 • Investment Banker = $258,000 • Landscape Architect = $64,200 • Occupational Therapist = $63,900 • Systems Analyst = $91,000

  11. How does an Employer Calculate Starting Pay? • Starting pay is generally decided by Hiring Manager with assistance from HR • Hiring manager/HR considers • Pay range of position • The candidate’s experience, knowledge and most recent pay level • The pay of comparably experienced staff within the company in the same pay grade • Supply vs. demand for position • Budget of the unit

  12. The Range is $25,000 - $40,000How much will they pay me? Maximum Pay of Range $40,000 Performance consistently exceeds standards Top third Performance meets and occasionally exceeds standards $32,500 Typical market range New to position or performance does not meet all standards Lower third $25,000 Minimum Pay of Range

  13. They offered me a job and a starting salary. What do I do now? • Don’t accept immediately – ok to ask for a few days to consider. • Do some research • Look at the job ad and key factors to assess internal value of job. • Look at company website for any info on pay ranges and company benefit information. • Talk to others in similar jobs to get an idea of starting pay.

  14. Do Some Research • Use Belmont Career Services • Use Belmont and local Library resources • Look at websites specific to your profession • Look at total pay package & consider what if any to negotiate

  15. Why Negotiate? • 100% employers expect you to negotiate, but only about half try • Men negotiate more than women • Employers perceive those that negotiate to have higher skill levels because of the effort shown • Be polite and know that some companies do not negotiate • Know when to stop and make decision

  16. Three Principles of Negotiating • Only negotiate after a firm job offer • Be respectful, know what you are talking about and don’t beg • First person to name an exact amount in effect loses ability to negotiate any more • If they ask how much you expect, ask them, “What is the salary range?” • Do you have more than one offer? How attractive a candidate are you?

  17. Why Negotiate? – Salary Differential in 3 years with 4% Raise Each Year • $30,000 – after 3 years = $33,745 • $32,000 – after 3 years = $35,996 • $35,000 – after 3 years = $39,370 • What is negotiable other than Pay??

  18. What can I negotiate? • Sometimes negotiable: • Pay and review date for merit increases • Signing bonus for jobs in demand (nursing for example) • Starting date • Job title • Additional first year leave for already planned vacations (generally unpaid) • Relocation expenses • Perks such as cell phones, lap tops • Professional conferences, training & certifications, graduate school tuition reimbursements • Flexible scheduling such as start time & telecommuting

  19. What can I negotiate? • Rarelyif ever negotiable: • Overtime eligibility – i.e. if the job pays overtime when > 40 hrs/wk worked • Retirement benefits such as 401K matching amount & vesting schedule • Health, dental, vision and other insurance premiums • Insurance and other benefit start dates

  20. Other Areas to Consider • Is the company culture similar to what I value? • Similar dress, work hours, work/life balance • Are the people I met enjoying their jobs? • What are the opportunities for job advancement? • How far a commute or how much traveling is required? • Is parking free?

  21. Make Your Decision • Remember, it is easier to move up in an organization than to move into a new one. • Whether you accept or not, be polite and thank everyone associated with the hiring process – NEVER BURN BRIDGES!

  22. Your New Salary • Assume starting annual salary of $38,760 • Social Security/Medicare @ 7.65% = $2,538 • Approx. Federal Taxes for single person with standard deduction = $4,305 • 401K contribution @ 5% salary = $1,935 • Approx. cost medical & dental = $960 • Total Annual Net Pay = $29,022 • Net Monthly Take Home = $2,418.50

  23. Websites for more information • www.salary.com - Excellent tool with free salary range information and more extensive fee paid information • www.sourcetn.org– TN wage and job info • http://www.flcdatacenter.com/ - U.S. Department of Labor wage search library and info • www.acinet.org - Government site with a variety of career-related information • www.homefair.com/ and www.bankrate.com – Calculators compare salary offers by location

  24. Websites for more information • www.naceweb.org/- Website for Career Services professionals with links to info on jobs for new college grads • www.collegegrad.com- Offers free job-related videos. Each video is about 1 minute in length. Provides quick, practical advice on resume and interview preparation, answering tough interview questions and info on over 50 different careers and industries.

  25. Other Print Resources • Help – Was that a Career Limiting Move? Pamela Holland & Marjorie Brody • Women Don’t Ask – Negotiation and Gender Divide, Linda Babcock & Sara Laschever • Negotiating Salary – How to Make $1,000 a Minute, Jack Chapman • 101 Salary Secrets, Daniel Porot and Frances Bolles Haynes • Perks and Parachutes, Paul Fargis

  26. Questions??

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