Are You Getting Paid Enough?
At one point in your career, you’ve probably asked if you’re getting paid enough. It’s a timeless question for employees, and it usually arises during times of economic uncertainty or high workplace stress.
Fortunately, many resources exist today for workers to check to see if they’re being underpaid. For example, websites like Glassdoor and PayScale offer ranges that average workers make in your field and with your job title.
You could also be straightforward and ask co-workers in your department how much they’re earning. It’s illegal for employers to prohibit discussion about pay in the workplace. Still, it’s an uncomfortable topic and could be sensitive, so tread carefully in this area.
No matter how you approach it, knowing what you’re worth and if you’re being paid fairly is essential. Being underpaid will cost you in the short run and in the long run. And typically, Americans are underpaid.
Recent Glassdoor research revealed that the average American worker could be earning 13.3% more than their current base salary. And a study by George Mason University and Temple University showed that being underpaid and failing to negotiate a raise costs the average worker an estimated $600,000 throughout their career.
Empire Resume will explain how you can determine if you’re being paid enough and what to do if you’re being underpaid.
Check Online Resources
Nowadays, many online resources exist with a wealth of data and information about salaries. Websites like Glassdoor.com, Payscale.com, and Salary.com offer databases where workers can compare their wages with others. The best part is that much of this info and data is available for free.
Start with these types of sites when determining if you’re making a fair wage. Search the websites by job, location, and industry to see average salaries and compare them to yours. If you’re earning less than the average salary within your range, this could be the first sign that you’re underpaid.
Ask Your Co-Workers
The second step: Ask co-workers. This sounds simple, but it’s a tricky question, and it’s one you’ll want to handle very carefully.
As we mentioned, it’s illegal for employers to prohibit the discussion of pay in the workplace. But it’s still a very sensitive topic and may not be socially acceptable at your company. So, if you decide to ask someone, be sure you ask someone you know well and trust and that you have the conversation in private.
You could also ask a former co-worker, as they may be more open to discussion. Make the conversation low-pressure, and don’t be surprised if the person doesn’t feel comfortable talking about it.
If you do get a response, this could be another valuable bit of information.
If you’ve been at the same company for a while, starting salaries may have increased and outpaced your annual raises. This is known as pay compression, and it means that new employees could be making the same or more than you, despite having worked for the company for less time.
Keep in mind: Workers who job-hop are less vulnerable to pay compression than more loyal employees who stay with companies for a while. So much for loyalty!
Consider These Questions
Thus far, you’ve made a salary comparison online, and maybe you’ve asked a co-worker or two what they’re being paid. That’s a good start.
The next step: Ask yourself these questions regarding your salary:
- Did you negotiate when you started? If you didn’t negotiate when you started the job, you likely lost some extra money. Employers expect new hires to negotiate and push for more money when offers are extended. It’s the name of the game. Keep this in mind for the next time you start a new job.
- Is your salary keeping up with inflation? As you may know, your dollar is worth less every year because of inflation. The U.S. inflation rate was 1.4% in 2020, according to the Bureau of Labor Statistics (BLS). So, if your salary didn’t increase by that same rate last year, you’re effectively being paid less than you were last year. Take note: Inflation is very high in 2021 so far, and the current inflation is at 5.4% as of August 2021.
- How well is your company doing? Wages usually stagnate during recessions and tough economic times. But sometimes, wages don’t bounce back during recoveries and when companies are flush with cash. If you feel your company is doing well, but you aren’t, do some research. Public companies must reveal quarterly and annual earnings, so it’s easy to find those numbers. If you work for a private company, look at internal reports. Has your company increased sales or revenue lately? Has it reduced costs or won any significant awards? These could all be hints that you should get a nice raise.
What’s Your Value to the Company?
If you worked on your own, what would you charge? Figuring this out is another way to determine if you’re being paid fairly.
Freelancers typically charge their clients more because they have to cover their own overhead costs. Still, it’s a good comparison. For example, if you’re being paid $25 hourly at your company, but the firm is charging clients, say, $175 hourly for your work, this could indicate that you’re being underpaid.
On the flip side, if your earnings seem in line with the hourly rate, consider upping your game. Take some courses and additional training to add to your resume, so you have a case to make for a raise.
Take Benefits into Consideration
A big salary number is excellent. But remember that benefits cost big money, too, and they should be taken into account.
Think about the benefits at your job and how much they’re worth. Things like vacation time, paid maternity and paternity leave, healthcare, sick leave, and 401(k) matching programs should be factored in when considering if you’re being paid fairly. Also, remember to factor in additional benefits like telecommuting, flexible work arrangements, and tangible benefits like a good workplace culture.
Many of these benefits add up to considerable sums of money. However, they also make your job better and could make your life easier, even if your annual salary earnings aren’t as high as you’d like.
Have a Plan to Ask For A Raise
If you follow all these steps, you’ll undoubtedly know the answer to the timeless question, “Am I getting paid enough?”
Whether you like the answer is a different thing altogether!
According to a recent survey by benefits consultant firm Willis Towers Watson, employers expect average annual salary increases of 3% for executives, management, and professional employees in 2022. That number is up from the 2.7% increases seen in 2021 and the average of 2.8% seen in recent years.
This sounds like great news if you’re one of the people who get a raise. But, if you don’t, or if you feel like you’re still underpaid, have a plan about how to ask for a raise. Doing so is complex but, in most cases, very worth it.
Come prepared with data when meeting with your boss, highlight your most significant accomplishments, and be prepared for setbacks. For instance, if your boss tells you there’s no money for raises, then you could possibly negotiate for better benefits, like more vacation time or more time working remotely.
Stay tuned to Empire Resume’s blog for more helpful articles and career advice on topics like Virtual Team Challenges, How to Prepare for Retirement, and How to Ask for a Pay Raise.
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Maria Gold is a Content Manager/Writer for Empire Resume. She is dedicated to helping educate and motivate people with the latest career articles and job search advice. Her interests range from writing to programming and design. She is also passionate about innovation, entrepreneurship, and technology.