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The reason I'm taking a general business question and localize it to software development is that I'm curious as to whether there are certain trends/etiquette/nuances that are typical to our industry. For example, I can imagine two different attitudes employers may generally have to payment negotiations:

  1. we'll give you the best offer so we can't really be flexible about it because we already pretty much gave you everything we can give you,
  2. we'll give him an average offer and give in to a better one if forced to.

If you try to play hard ball in the first attitude it'll probably cost you the job because you ask for more than they can give you, however if you don't insist on better payment in the second one you'll get a worse offer.

In short, when applying to a typical job in our industry what are the typical attitudes from employers on the offers they give, what is the correct way to ask for a better payment, do these things differ between different types of companies (for example startups vs well entrenched companies), and how do these things differ between different kinds of applicants (graduate vs student)?

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6 Answers

up vote 7 down vote accepted

It depends on experience. Fresh out of University I've found there to be very little negotiating. Once you have experience, everything is negotiable.

That said, large companies tend to have fairly rigid compensation guidelines. That said, they can still adjust you title / responsibilities to get you into a higher pay scale.

Smaller companies tend to be more flexible with things like pay and holidays.

You never want to make the first offer, you always want to respond.

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Actually that last statement is a myth. The first offer serves as an "anchor" for the negotiation. –  Mike Brown Aug 5 '13 at 19:44
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If they give you an offer, you can always ask if the offer is negotiable. If they like you they're not going to not give you the job just because of that question.

Can you really imagine?

"Here's what the job pays."

"Is that negotiable?"

"No, and now you don't get the job, goodbye."

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Everything is negotiable, always. However be aware that attempting to negotiate always opens you up to the possibility of them saying, "Goodbye." If you're not OK with that, then you're not in a good negotiating position and shouldn't push it.

If you don't know anything about negotiation, the advice in Start With No is a useful starting place for advice. If you have some negotiating experience, Bargaining for Advantage provides a theoretical background to negotiate better.

Even if you don't like to negotiate, read up on how to. Because even if the only negotiation you do is every few years when you get a job, getting just a $5K salary bump will pay you back manyfold very quickly.

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Read Steve Hanov's ideas on salary negotiation. With a little game theory, he shows that you can't afford not to negotiate. Know what you're worth by doing a little research. Whoever names a concrete number first loses.

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The biggest differentiation is whether they came after you or you came after them. If they contacted you, you are in a much stronger negotiating position. If you contacted them, obviously you need it more than they do.

Of course you can always negotiate. You should have found the range during your interviews. Hopefully you didn't mention a salary during interviews. That eliminates your options. If you had enough sense to ignore their requests for an answer to their "what salary are you looking for" question, you are in a stronger position. What do you want? Is their offer out of line? If so, tell them that. If you must have work, take what they offer and look somewhere else immediately. Your strongest position is to seek work while working.

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I always think its impolite to haggle over pay (never do it in an interview).

However, it is acceptable for the recruitment agent to haggle for you! I always tell them to do their best on pay, and they do - usually its between them and the HR or senior boss, not the guys you'll be working with or for, and they get paid more commission the more you get paid, so its in their interests to do it anyway. So let them get on with it, let the agent deal with all those kind of 'awkward' deals.

They also have more inside information than you do as well, especially if they've placed others at that company, they'll know exactly the range of salary you should be getting, not just the salary you expect. This can work both ways, but at least you will not be pricing yourself out of the job by being a bit greedy :)

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