How to Get a Raise
I’ve been slipping a little in my quest to answer reader questions of late, so I thought I’d course correct. The question revolved around the notion of how to get a raise. Actually, that was the question in its entirety.
How do I get a raise?
A deceptively simple question that one. So much so, in fact, that I’m going to be kind of roundabout in my response.
Paying the Iron Price for Cable
Assuming that you’re one of the millions of people that pay for cable television, you fork over your $100 per month and get the full rainbow of channels. You probably don’t think a whole lot about the $100 that you’re spending each month because it’s the closest a recurring cost can come to being a sunk cost. You’re used to cable and you’re used to your wallet being $100 lighter, so continuing to have cable for $100 per month is not a decision that you consciously make. In fact, to do something different would be the conscious decision.
Bearing this in mind, do you ever think to yourself, “you know, I love how they’ve finally stopped killing off erstwhile protagonists on Game of Thrones, so I think I’ll call the cable company up and offer to pay $103 per month, starting in the next fiscal year?” Of course you don’t — that’s ridiculous.
But, let’s consider a slightly modified version of that scenario. Let’s say that the cable company called you and said, “we’re raising the price of your Premium Thingamajig Package to $103 a month, so if you want to continue to see what Sansa, Arya and the gang are up to, you’re going to have to pay up.” You probably go on to Facebook, post a cathartic rant, and then pay the extra money. Because, while that’s inconvenient, what would be more inconvenient is to have to spend time figuring out how to compensate and vary your routine. You could go with Dish or AT&T or whatever, but that’s probably too much effort to expend over a 3% increase. If it were a 10% or 15% increase, on the other hand, it might be time to comparison shop.
Employment as a Zero Sum Game
As you’ve no doubt surmised, I offered this silly parallel to help you empathize with your employer’s position. You’re the cable company in their lives — non-critical, largely taken for granted, and prominent enough to be missed as long as the price isn’t too high. And, like your relationship with your cable company, your relationship with your employer is, talk of family and work-life balance notwithstanding, a zero sum game. The more money you have, the less they have, and vice-versa.
Your employer will agree to a 3% average hike per year (this is called a “cost of living adjustment” or “COLA”), because that’s what it’s worth to them not to have to endure the annoyance of back-filling your position. They may, in a pinch, agree to a good bit more if you extort it from them (imagine if your cable company announced a rate hike the night before the season finale), but that will probably engender enough long term bad will to be a Pyrrhic victory.
So, what is the key to getting raises? Well, at the risk of carrying the analogy too far, the key to getting a raise is not to prove that you’re the hardest working, scrappiest, most awesome cable company out there. That’s the fodder for inane, LinkedIn career advice. Rather, you want to go from being their cable provider to being their mortgage lender or county tax board. You need to get into a whole different category of role.
Understanding Salary Bands
When it comes to depressing wages paid to the staff in general, information hiding is probably the organization’s most powerful weapon. Usually, employees are specifically instructed that salary information is confidential and even that sharing said information can lead to disciplinary action. Companies don’t want people to know what their cube-mates make because that leads to the inevitable, “why does Alice get paid $3K per year more than me when I’ve been here 4 years to her 3 and I handle all of the toughest accounts, and blah, blah blah.” And, armed with that information, the employees would be more likely to work out a common scheme for higher wages.
However, information does leak, and it can wind up being subpoenaed, so that can go only so far. Enter the salary band concept. This is a construct that organizations use to indemnify themselves against lawsuits for unfair salary practices. It might say that Software Engineer I makes between $60K and $70K while Software Engineer II gets between $68K and $80K, and so on. The range allows for some wiggle room in comp, depending on performance, but the bands ensure that salaries are not doled out with utter (and possibly liability-incurring) caprice.
Getting that Raise
In a world of salary bands, the key to a raise is a new salary band. Without a new salary band, your employer is going to do two things when you state that you want more money.
- Tell you to wait until your next performance review (usually annually) and state your case.
- Possibly offer you a slightly larger COLA for your squeaking wheel.
And, that’s basically it. Without a new salary band, the name of the game is giving you the minimum amount of money required to stop you from leaving. With a new salary band, the company’s own litigation avoidance bureaucracy does the heavy lifting for you when it comes to getting that raise.
So, naturally, the question backs up a level: how do you get into a new salary band? Here are your options, sorted by effectiveness at getting a raise in the shortest order.
- Find a job with a different company.
- Leverage a competing offer**
- Find a different position within your company.
- Wait around until your company gives you a promotion.
- Work really hard to try to earn a promotion.
It my seem extremely cynical to list (5) at the bottom, since (5) is the standard corporate narrative for how to get ahead. But here’s the thing — it’s a really low leverage play. In the first place, once you’re hired into a group, it’s incredibly tough to get people to view you in a substantially different light. No matter what you do, people will tend to remember and revert to their mental model of you when you came on board.
And, secondly, working really hard in a vacuum will have little effect. You need to work really hard, get it conspicuously noticed by your manager (self promote), have your manager not be put off by anything you do for a while, and maintain that good relationship indefinitely. There’s so much that can go wrong during the years you have to keep at this. You could wind up getting blamed for something beyond your control and permanently losing face in the manager’s eye. You could go unnoticed. Heck, the manager might leave the company, taking all of your sunk relationship-building (and, frankly, brown-nosing) with her.
(5) sits at the bottom because of all of that. And, (4) is basically the same thing, but it ranks higher because it’s much easier. Most ascensions through the ranks of a single company happen largely via being in the right place at the right time and having hung around long enough. (3) is better than either of those options because it’s a low-risk way to change scenery and force yourself into a situation where you’re reevaluated in earnest. (2) is a high risk, low-ceiling play, but it’s one of the most effective ways to get extra cash in a hurry. And (1) is at the top because it’s the only one of the options totally within your control vis a vis your current employer; you can go out interviewing whenever you please, without waiting for the fiscal year or putting your name in the rotation hat or whatever.
I’ll close with somewhat of a redemption narrative, because it strikes me as generally sad that most places work this way. If you find yourself working for an organization (or department) that is doing extremely well, the games are often unnecessary. If the company is trying to scale up quickly, your role as the sole person maintaining a small site might rapidly evolve into Director of Web Applications, with 20 people in your reporting structure. And, something like this invariably comes with a nice pay bump. A rising tide lifts all boats, as it were.
The business of securing more money for yourself can be a messy one. Think back to the cable company analogy. The cable company raises their rates as much as they can without really pissing off their customers, and their customers kick and scream to keep the rates as flat as possible. In a lot of cases, the relationship is one of tolerance due to mutual predictability. Attempting to carve out a sizable increase in your take means throwing predictability to the winds and rolling the dice. Such is the nature of the game.
Eric, the cable company analogy is spot on. Keep up the good work, because it is easy to forget these inconvenient realities when you are living 9-9!! You are replaceable if you cross the PITA threshold. I encourage you to cross post links/reading materials/research that you think reflects the dark realities of employer employee relationships. I have been reading ‘Disciplined Minds’ lately. Some of my co-workers just cannot wrap their heads around these ideas, they fall clueless when I asked them .. if you are not supposed to put all your savings in one basket whey do you earn all… Read more »
Hey, glad you like! I tend to do a fair bit of content like this, and it’s the subject of the book I’m currently working on.
I added Disciplined Minds to my Amazon list, by the way. The first sentence alone indicates that it’ll probably be a good read. Looking forward to check it out — thanks for the recommendation!