Is it OK to ask for a raise during a recession?With the end of the recession still not in sight, many companies are struggling, managers are tightening budgets and employees are simply happy just to have a job. Melanie Wanzek |
|
|
“I would think very carefully before asking for a raise during the recession,” says Laura Hampton, the director of marketing membership and training services for The Employers Association, a member-based human resource and training company in Charlotte, N.C. “But if you feel like you have contributed above and beyond what’s expected of you, exceeded specific goals, and your company is doing OK – by all means, go after the raise.”
Done correctly, in fact, asking for money in a professional and respectful way, based on quantifiable performance, can enhance your value. “People appreciate the fact that the employee is interested in contributing, improving their skills and going places with the company,” Hampton says.
Start with thoughtful research about the company’s current financial position and budget, including its strategy for riding out the recession. Hampton points out that pay philosophies differ among organizations. Some tend to enact pay increase across the board, while others only award key performers.
“If you’re not sure how these things work, find a trusted mentor within company or go to someone within HR to get some coaching,” Hampton says. “Ask how they recommend to approach a manager.” Hampton adds that many companies are cutting budgets and implementing pay freezes. “If they are in the position where they’re implementing an across the board pay freeze, step back and evaluate – there’s good reason for that,” she says.
Workers would do well to take a partnership approach with employers, according to John St. John, director of training and education for the California Employers Association, Sacramento, Calif. Rather than entering a manager’s office immediately, it’s important to research the company’s financial status and have concrete examples of your own contributions to the organization. “You need to illustrate how the business earns money, and your role in the moneymaking,” he says. “It shows you are oriented to what is important.”
St. John also says its imperative to demonstrate how you have consistently increased value or generated revenue through quantitative measures, such as number of grants written or sales closed. Employees should recognize that a pay raise means an added expense to the company’s budget. Consequently, it’s also important to demonstrate how you will increase your output following the raise to make up the difference. This is particularly true in a recession, when extra funds for salaries simply are not available unless employees create them.
“Entering a partnership means bearing some of the burden for what you are requesting,” he says. “Your raise is based more on future performance, not the past… In this economy, good intention isn’t going to fly. But if you go to your boss with plan to generate revenue from which to pay yourself, that’s not insensitive. That’s good business.”
To present a quality plan, lay out the steps you will take and allow your employer time to observe the truth in your claims. St. John recommends offering your employer a six-month trial period. “The employee could agree with an employer to produce the projected results before receiving a new pay rate,” he says. “Then, the employee could base the any pay increases on the additional value or sales produced by the employee.”
Also consider if other requests may be more viable and less of a strain on the company. Hampton suggests options such as a bonus for a recent accomplishment, or a few additional days of vacation. “Sometimes that can go a long way and can even mean more to some people,” she says. “Plus, it doesn’t cost the company cash, so [the company] might be able to accommodate that.” Remember to keep your long-term goals in mind while remaining sensitive and informed in the short-term time. If a company does voice financial concerns and it’s possible for you to delay a raise request, Hampton recommends waiting for positive signals, such as landing a great new account or eliminating hiring freezes.
“That’s the time to mention you have had a concern for the past few months but have appreciated the company’s financial position and decided to wait to approach them about a raise,” she says. “Then you would be seen as a team player, and they might be more willing to take a look at giving you a raise.”
In the workplace which generational cohort is the worst?