The Case Against Stating Your Target Salary
In recent preliminary discussions with a prospective new employer, a currently well-paid IT marketing pro I know dithered over whether to declare a salary target for himself before any interview with a company that expressed interest in him.
His concerns were not just about telling the company his true target, but also about broaching any figure at all—even if only as a high-ball negotiation gambit and opener to haggling.
Setting aside the question of whether or when (in terms of timing or circumstances) to state salary expectations during an interview, his issue was whether to state it before being invited to an interview.
The closest approximation to a salary expectation he revealed was to state upfront that if it were less than he’s making now, the offer shouldn’t be much less than that, without having told them how much he’s currently earning—which in fact, is about $6,000/month as a base, with some big money in the pipeline in the form of an almost six-figure bonus and equally huge commissions. (Why leave such a plum job? Looking for a better skills-values-challenge fit.)
Despite however tempting a pre-interview revelation may be to others, his reluctance to state his salary expectations is commonplace, understandable and arguable—in the sense that there is a prima facie strong argument for remaining silent about it before (and maybe even during) an interview.
Why Not State Your Target Salary Before an Interview?
Here’s the argument:
At the pre-interview stage, there are several critical unknowns:
1. the pre-interview salary maximums the company is willing and (believes it) can afford to offer (as two or more different figures):
2. the pre-interview minimums you are willing and (believe you) can afford to accept (as two or more different figures), which may be unknown even to you or subject to change in an interview
3. the pre-interview probabilities of offer and acceptance associated with each dollar figure
4. your and the company’s pre-interview perceived value as one of several determinants, in addition to the company budget, of those probabilities (Note for math types: This is an instance in which probabilities and utilities used to calculate expected gain are not independent of each other).
With so many unknowns, it can be argued that not only is pre-interview dangling of an expected salary premature, it may also be very risky. The problems arising from the foregoing uncertainties include the following:
—INCOMPLETE AND EVOLVING INFORMATION: Because critical information required to defensibly propose a salary is missing, incomplete and subject to crucial updating and revision by one or both sides in the interview, the pre-interview dollar figure you dangle is likely to be uninformed in some important respects.
For example, even if it is only a negotiating ploy, if you open with a high-ball figure (e.g., based on your preconceptions of what the company can afford, greed or what you are “really worth”), you may discover in the interview that the job is not as great as you thought, but still good enough, and therefore will want to ask for even more and kick yourself if the company accepts your high figure.
—RISK OF MISPERCEPTION: If your pre-interview stated expected salary is actually lower than what the company is prepared to offer, you may risk being perceived as less desirable than if you wait for the interview, because of suspicions about you, perceived desperation or a “luxury effect”. If your salary bid is too good to be true or is simply very low, the “buyer” may back off because of suspicion (about whether the goods, including your credentials, are fake or exaggerated) or because of a presumption that “easy=desperate”, or because of some presumed prestige and “price=quality” equation, i.e., “you get what you pay for (it)”.
On the other hand, if your declared salary target is actually higher than what the company is prepared to offer based on its preliminary assessment of you, the misperception risk is that if you declared the high figure as an opening negotiation gambit, the employer may see it as your line drawn in the sand or chiseled in stone and shut down any salary discussions before they can even start.
Otherwise, if your proposed salary is your true, “compromise” target, yet still above what the company wants to pay, you may trigger “sour-cherry picking” of your resume to eliminate you from further consideration—as a case of selective misperception (to the extent that your strengths get downplayed by the employer as your weaknesses suddenly become more evident and more serious. This can be interpreted as a variation on what in transactional analysis is called a 2-handed game of “blemish” (looking for flaws and faults for strategic, usually unconsciously sought advantage).
What About During the Interview?
OK, so pre-interview declaration of salary expectations has its problems. But what about during the interview—especially when information gaps are filled, the information or impressions change, or something important gets highlighted or cleared up? In particular, what should you (not) say when asked, “So, what are your salary expectations?”
Even as a game of more nearly “perfect information” mid-interview, revelation carries risks. One tried-and-truly popular approach is what I’ll call the “Philippinegotiation” strategy: “It’s up to you, Sir.”— which is the most common response to “How much?”,when asked by a tourist (including me) there. This can be packaged as “whatever you feel is fair” or “What figure do you have in mind?” The pluses of this cagey approach are that
- It can empower and please the employer or recruiter by feeding their desire for control or deference.
- It evidences flexibility on your part.
- It suggests that you aren’t greedy and that “money isn’t everything” for you, e.g., that you are motivated at least in part by the intrinsic and other rewards of the prospective job or of work in general.
- It suggests you are sly—in a positive way (which is a big plus in occupations such as jobs in high-pressure sales).
But, of course, there are downsides:
- It can come across as passive buck-passing and shirking of “responsibility”.
- It may suggest a lack of confidence in stating your believed worth, whether high or low.
- It may suggest you are too honest to admit you aren’t worth much.
- It can suggest you believe that the employer is unaware of how low the actual market value of your services is and that therefore the employer will pay more than you are worth. (This, I believe, is the prime motivation of the Philippinegotation tactic among vendors in the Philippines.)
In any interview during which you are asked about your salary expectations, you will have to weigh these pros and cons—both before the interview and in the pressure of the moment. If you can pull this mental juggling off successfully, it will demonstrate something both you and the interviewer should be aware of.
That you are in fact worth a few more dollars than either of you imagined.