Even though it’s not unusual for a prospective hirer to ask “What is your current salary?” the question always sounds invasive. Maybe that’s why job candidates don’t spend much time preparing for the question, but they should. Of course the company representative wants to know what you’re earning now. Following negotiating theory, your response sets the floor of your future negotiations. Also, according to the theory, it would be better if your counterpart throws out the first number, but as a job seeker, you may not have that luxury.
So, when asked what you are currently making, respond truthfully, but remember to describe the entire picture. For example, say you are in a sales position that compensates on a base-plus-commission formula. Your company also allows you to work from home and offers a benefits package that is above market. Tell the interviewer what you expect your total take home pay to be this coming year and note the projected growth in sales that you will have achieved over the previous pay period. Add that you consider the ability to work from home and your current company’s generous benefits package a quantifiable part of your current compensation package.
If you’re asked how much you hope to earn in your next job, be prepared to give a number. And, importantly, that number should be higher than you expect to receive and higher than the minimum you would feel comfortable accepting. Again, negotiating theory- if you want to receive X, ask for more than X. Statistically, the ultimate result in any negotiation is close to the median of the bid and the ask.
According to authors Babcock and Laschever of Women Don’t Ask, on the average, women are 30% less inclined to negotiate than men. Additionally, they state, “By not negotiating a first salary, an individual stands to lose more than $500,000 by age 60—and men are more than four times as likely as women to negotiate a first salary.”
So when the topic of compensation arises. Be prepared, tell the whole story about your current compensation, and don’t ask for exactly what you want; it’s unlikely you will get it. Ask for more.