First things first: The days of automatic pay raises or cost-of-living increases are long gone. Even workers who are in organized unions aren’t guaranteed pay increases – even if it’s already in the contract – because some employers like state and local governments are simply refusing to honor the commitments they’ve already made.
But unless you’ve been living in a cave for the past couple of decades, you probably already knew that.
According to the US Bureau of Labor Statistics, the average employee pay raise in 2013 was just 1.9%, which is below the 2.1% US inflation rate. That means most people’s spending power actually went down, not up, in the past year.
And given the current job market, many workers today are happy just to hold on to their job, let alone get paid more to do it.
Yet getting a raise in today’s economy is not impossible – at least not if you go about it the right way.
Workers Most Likely to Get Raises
While the number of workers who can reliably depend on an annual pay raise is shrinking, there are some job categories that are more likely to get a raise than others. These include:
• Workers in Highly Competitive Fields — If there is a high demand for what you do and many other companies are vying for your services, denying you a pay raise is likely to cost your bosses more than giving you one.
• Superstar Performers – Regardless of economic conditions, the top performers in any field are going to be more likely to successfully secure higher pay raises than their peers. The trick is getting on top and staying there.
• Sub-Minimum Wage Jobs – Some positions, such as restaurant server or cocktail waitress, are exempt from minimum wage laws. While employers of these workers will often give pay raise in increments of as little as six months just to retain tipped staff, the increments never really add up to all that much.
Even if you don’t fall into one of these categories, don’t despair. You can still ask for – and receive – the pay raise you deserve as long as you follow a few simple steps.
TOP TIPS FOR GETTING YOUR PAY RAISE
Remember when you were a little kid and there was something you really, really wanted? If you were smart enough to wait until your mom or dad was in the right mood, you were more likely to get it, right?
Like anything else, when asking for a pay raise timing is everything. If you ask your boss for a pay raise the same day a negative earnings report is issued or the sale of your company is announced, the chances of your getting the raise you want are slim to none.
Many companies follow strict annual review schedules and will only issue pay raises to some or all employees at the same time each year. In other places, pay increases are tied to an individual’s anniversary date. For example, you won’t be eligible for a pay raise until you’ve been there for six months or a year.
If you aren’t sure what your company’s policy is, ask your human resources representative, consult the employee handbook or even ask a trusted co-worker who has been around longer. It might not be wise to ask your boss: It could cause them to start thinking defensively.
If you work for a company with these types of policies, the time to set your plan into action is about three or four months before a pay increase can be considered – not the day before your annual review. This gives you plenty of time to lay the groundwork that will guarantee your pay raise.
Step 1: Keep Track of Your Wins
Your boss will be less likely to say “no” to your request for a pay increase if you can present hard, undeniable evidence of your contribution to the success of the organization. But even the most successful employee will have a hard time remembering what they did 10 months ago – or even a few weeks in the past – so it’s important that you maintain an ongoing record of your successes.
Not sure of where to start? Then pull out the official job description for your position and use it as achecklist. If you can mark a “yes” next to every job requirement on it – and give tangible evidence, such as official reports or other documents to back it up – then you have everything you need to argue successfully for more money when the time comes.
Step 2: Save Everything
Start a file where you can throw documentation for every complimentary letter, email, letter or just pats on the back from your superiors. These types of “attaboys” are powerful reminders of how much you’ve contributed over the past year.
Now that you’ve successful built a case for your pay raise, the next step is to determine how much you should ask for.
Step 3: Ask for What You’re Worth
Most companies are willing to pay for performance, especially if you can provide the hard evidence that backs uphow much you have contributed to the bottom line. In many cases, asking for a pay increase is a negotiation: You want to start with a figure in mind, but have a lesser number you can fall back to if necessary, i.e. You ask for 7% but are willing to take 4%.
It’s important that you have a hard number to pitch to your boss. But you have to be careful not to overestimate your value to your superiors because if you ask for too much they are more likely to reject your request.
Step 4: Do Your Research
A good place to start is your departmental annual budget, if you can get your hands on it. Most companies will build in employee pay increases that are tied to achieving growth objectives – generally in the area of 2% to 5%.
Determine the line item pay increase for your job and use that as a guideline for your request. If your company has reached its goals, you probably can expect to be compensated if you have done a good job during the previous 12 months.
If your request is denied or your boss makes a counteroffer with a lower percentage, there could be little benefit to making a counter-counter offer. You may have to take what you can get while you plan the next step in your career.