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Negotiating IT Salary

The biggest mistake IT people make when negotiating a salary increase

This is a real bug bear of mine, so please excuse this rant.

Heck no, don’t excuse it, sit up and listen, and take notes if you need to.

When I ran my technology company Lindentech (I sold it in 2009 but they are still going strong – check them out at www.lindentech.com.au), there was an all too common thread when it came to performance review time. After going through the strengths and weaknesses of an IT Support or Systems Engineer we would inevitably start talking about remuneration and whether a pay rise was warranted and how much that might be.

How a typical salary negotiation looks like

Very often the conversation went along these lines:

Tech Employee: I really need an increase in my salary.

Me: OK, why do you say that?

Tech Employee: I’ve just bought a house, I’ve got a large mortgage now and heaps more expenses that come with running a house and with the current mining boom in Perth at the moment the cost of everything has gone up substantially. I need a salary boost.

Me: OK, so let me get this right. I need to up your salary because you chose to buy a house and because your costs of living have increased?

Tech Employee: er well, I can’t go backwards,and I need to support my family, with inflation like it is at the moment, I’ll need a significant increase just to keep up with inflation.

Me: I appreciate you need to support a family and that it’s tough sometimes to make ends meet particularly with the cost of living being so high in Perth.

(Ah, see what a niceboss I am, active listening skills displayed right there)

Chip <or insert suitable name for technical employee here>, I’m not in the business of rewarding property purchases nor am I here to offset changes in your cost of living. If you want a pay rise, you need to prove your value to the company, specifically how your performance improvement over the last year has positively impacted the company.

Tech Employee: right, well let me think about that…

And therein lies the problem.

How to effectively negotiate a salary increase

Here’s the massive tip for every IT employee out there… know your worth to the company and be able to articulate that, at any time. Give numbers, examples, achievements, certifications, anything that proves outcomes for the company. If you were hired for a specific reason, know that reason and prove you’ve achieved it.

I still hear constantly from IT candidates that they need a certain salary or a salary increase because of their own financial circumstances. This is absolutely true and necessary, it’s just largely irrelevant when you’re negotiating with your boss. Salary is set by your performance, value to your current employer and market conditions for your skillset (meaning, what salary you could likely get at another employer.)

Happy negotiating! Got a good tip? Share it below.

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