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John A. Challenger
A quick guide to getting a pay raise

Think you deserve more money? Now is a good time to prove it—and reap the financial rewards.

October 7, 2013
By John A. Challenger

The economy is slowly recovering. Layoff announcements have stagnated, but corporate and consumer costs are rising. It is probably not the best time to ask for a salary increase, right?

Wrong.

Pay raises may be harder to come by in the current business environment, but those who can prove that they were an integral part of an organization’s ability to survive the downturn and thrive during the next expansion have nothing to lose by asking.

Americans’ salaries are not keeping pace with inflation, which is tantamount to a salary decrease in terms of year-to-year spending power. Unfortunately, employers are suffering from rising costs as well, and while more are starting to pass along these costs to consumers in the form of higher prices, it has not been enough to offset those increased costs. As a result, jobs get cut, and wages are frozen.

But, for employees hoping for an above-average raise, simply needing more pay will not cut it. Workers have to prove their worth, as organizations are reserving the most significant boosts in compensation for top performers.

High performers getting bigger raises

A recent report from the Mercer consulting firm projects U.S. salaries will increase an average of 2.9% in 2014, up from 2.8% in 2013 and 2.7% in 2012. However, companies are still rewarding their top-performing employees with above-average pay raises. That’s because organizations turned to these employees to help them get through this slow economic time, and they want to ensure they retain these workers for the long term.

With new evidence suggesting salary increases will remain stagnant, a well-planned raise negotiation may be the most effective plan for workers.

Prove your worth

You have to enter the meeting with a well-thought-out justification for a salary increase. It should be based solely on performance, whether it is exceeding established goals, creating and implementing money-saving strategies, or bringing in new business. Support your points with numbers and specific examples, and be prepared to answer questions or objections.

Even if you present a great case, some companies simply do not have the money to reward their best performers with higher salaries. Still, you might be able to negotiate some other benefit—or at least put yourself in a good position for a salary increase when conditions improve. Here are some other, time-tested suggestions that Challenger, Gray & Christmas has found helpful when making a case for a raise:

Seek more responsibility. Volunteer for challenging tasks and exhibit a take-charge attitude. Assuming additional responsibilities demonstrates how you can increase value for the corporation.

Meet your boss’s boss. At the next company event, go out of the way to meet those at least two rungs higher on the corporate ladder. They are the ones who can advance your career.

Join a company committee. Whether it is a committee developing new workplace policies or planning the company holiday party, joining or volunteering can help build relationships with other people in the company whom you might otherwise never meet.

Find and/or become a mentor. Mentoring and being mentored provide perspectives and new ideas about career goals and how to achieve them.

Align individual and company goals. Evaluate the company’s goals and identify the similarities and differences in comparison to your personal career objectives. Look to bridge the gap in differences by attending meetings and company-offered development courses. This shows a willingness to be on board with the company’s future plans.  

Discover ways to save money. Finding ways to increase efficiency and performance while decreasing costs is especially important in a time when employers are looking for ways to reduce spending. This contributes to the organization’s profitability.

Become an expert on one facet of your field. It is important to be a generalist, but knowing more than anyone else on a specific issue or topic will help make you the “go-to” person for anyone in the company who has a question in that area. Specialized knowledge makes you extremely valuable and should be covered in your résumé.

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John A. Challenger is CEO of Challenger, Gray & Christmas Inc., a global outplacement consultancy. He is a recognized thought leader on workplace, labor, and economic issues.