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Job Offers: Evaluating & Negotiating - Part I
May 5, 2006
Once you receive an offer, your job search takes on a new dimension. Now you face the decision of whether to accept the offer as is, negotiate, or turn it down. Following are some guidelines that will help make this process easier to navigate.

How will I receive an offer and what will it include?

Typically, you will receive a phone call offering you employment followed by an official written offer. Offers usually include the job title, salary, any bonuses and stock options (keep in mind, fewer employers offer these in today's sluggish job market), relocation package if applicable, start date, supervisor's name, a deadline for responding, and notice if the offer is pending a background check and drug screening.

You may also receive a packet that contains detailed information about other benefits such as insurance options (life, medical, dental, vision), employee assistance, wellness, outline of vacation and sick leave, observed holidays, etc. If this packet is not sent and these factors are particularly important to you, ask to have it sent to you prior to making your decision.

How do I evaluate an offer?

At the beginning stages of your job search, you may have developed a list of criteria you were looking for in a job. Review this list and perhaps add to it based on what you learned through the job search process. Examples of possible criteria include:

  • Interest in particular job function, e.g., management, sales, analyst, consulting, design, manufacturing, or an interest in a rotational program
  • The opportunity to work on challenging projects
  • The opportunity to use skills and abilities that reflect your strengths
  • A setting that will allow you to express your values
  • Working independently and/or as part of a team as you prefer
  • The opportunity to travel and/or work in a certain geographic location
  • A position that will be compatible with your desired lifestyle, e.g., not working more than 40-50 hours per week, family-friendly environment, etc.
  • A position that offers certain perks or incentives or a certain salary level
  • Job security, opportunity for advancement and professional development

Rank and organize them into 3 categories:

  1. Items you definitely want
  2. Items you prefer but could do without, and
  3. Nice extras to have on job.

Prioritizing is important because like other things in life, sometimes you have to compromise. Evaluate the offer by analyzing to what extent the position meets the factors you listed as those you definitely want in a job.

Other questions you may want to ask yourself include:

  • What are the job duties and responsibilities? Are they realistic?
  • Is the work challenging? If not, is there variety in the work? Will I be learning new skills? Where will this job take me in one or two years?
  • Do you like the working conditions as well as your potential supervisor and co-workers?
  • What is the organization's reputation? Is the organization growing or downsizing?
  • What is the compensation package? Does the salary meet your financial needs? Some smaller employers sometimes offer creative benefits to attract good employees, such as stock options, transportation costs, meals, flex-time, or tele-commuting.

After answering these questions you may need some time to think an offer through or you may be ready to make a decision. If you need more information, do not hesitate to ask the employer for additional detailed information about the offer or what it's like working with their organization. This is a big step, and you want to have as much relevant information as possible before you make such a consequential decision.

Do I negotiate?

Negotiating an offer is not standard practice for all applicants who receive an offer. You should feel free to accept the position as offered if you feel it's a good offer that meets your needs. On the other hand, you may consider the offer non-competitive and wish to negotiate a better starting salary or benefit package.

Keep in mind that entry-level employees do not usually have a lot of latitude for negotiations and not all students are in a position to negotiate with companies. Some employers have a policy of starting all new employees at the same pay rate while others will allow for some negotiation. Below are a few recent comments from recruiters on this topic:

"I think it is good when they negotiate as it shows a little fire in them, that they did research on going rates in industry and that they feel they're worth it! We can always say no...."

"Offers are typically firm and I strongly discourage students from attempting to negotiate. The exception would be those students who receive a competing offer. In those cases it is understood that the student may ask if the offer can be matched or exceeded."

One employer recently commented, "Salaries continue to be competitive, but fewer companies are willing or able to extend offers where the salary is outside the industry range. Students should not expect to see offers that include sign-on bonuses or stock options. Benefits will continue to evolve as companies strive to maintain a balance between the cost of offering benefits and the needs of the workforce."

Government and nonprofit employers usually have less room to negotiate salaries. Government salaries are standard based upon education and experience and are typically included in the job announcement. Benefits packages are often very comprehensive and may amount to 20-30% of your salary.

How do I negotiate?

If you choose to negotiate, it is not enough to tell a prospective employer that you need a higher salary; you must present information about the market rate for comparable positions and skills sets, and be prepared to articulate why you are worth more than the salary being offered. Information about salaries is available online, but remember, salaries listed may not be an accurate reflection of entry-level Bay Area salaries.

National surveys usually reflect mid-level, not entry-level salaries, and represent a lower cost of living than that of the SF Bay area. Cost of living comparisons are important if you plan to relocate. What is the real buying power of your salary? A salary of $25,675 in Seattle can buy as much as and is equivalent to a salary of $40,000 in Berkeley.

Other items to negotiate include start date, relocation costs, stock options, vacation leave, flextime, signing bonuses, and professional development activities (classes, association dues, special training).

Plan what you want to say and practice out loud. Approach your prospective employer in a non-confrontational manner. First, indicate your genuine interest in the position. Then present the information about salary rates, and indicate what you think would be an appropriate salary range. Provide them with reasons to support your request, such as relevant internship experience, special skills, high GPA, or other job offers. Your personal financial needs are not a compelling reason for employers to increase your salary. You must be able to demonstrate what is unique about you and the extra value that you will bring to the employer.

Ethical Dilemma

If you are offered a position that you feel you "should" accept because you fear you will not have other options, think carefully before you accept. Do not accept an offer before you are ready. Acceptance of an employment offer should be made in good faith and with the sincere intention of honoring the commitment.

Once you make a commitment to start a job, it would be viewed as unprofessional and unethical should you renege on your commitment. You are welcome to discuss this dilemma with a career counselor.

 
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