Construction wages in Australia are at a standstill. Despite an increased demand for construction staff, recent research has revealed that two-thirds of all construction employers are intending to offer either no pay raises at all this year or rises of less than three percent. Within this climate, it has become increasingly difficult for construction employees to negotiate the salaries they’re looking for successfully. However, fear not, if approached in the right way, it’s still possible to secure yourself a salary increase.
We asked our recruiters at Construction People to provide some insights on the do’s and don’ts of pay negotiation, whether you’re going for a new job or a salary increase from your current employer.
Negotiating a job offer
Even though the construction industry is experiencing a period of high growth, Head Contractors are reporting very low profits. Even the giant construction firm Watpac has just announced a loss for the 2016/17 financial year. But this doesn’t mean you should be over-cautious when bringing up the topic of salary with a potential new employer. It’s always worth speaking to your network to find out what competition you face, and what the skills shortages are in your area. If a company has a specific need for a particular set of skills or staff in a regional location, and you fit the profile, you can use this information to strengthen your bargaining position.
It’s unwise to bring up the topic of salary at the beginning of the first meeting with your new employer, it’s a topic that needs to be discussed, but it’s much better to cultivate a good relationship with them by leaving any talk about pay until you each have a better idea of what you require from one another.
When the topic is brought up and you’re asking for a higher starting salary than the current package, you should always be able to back up your position with what value you will bring to the employer. It’s not enough to negotiate on the basis that it’s what someone else is earning, or what the market is paying, you’ll need to make a good case for it based on your own skills and achievements. Be prepared with a list of the attributes you can bring to the role that set you apart from your competitors, backed up with examples and evidence. If you can prove to them that you will be more of an asset to their organisation than expected, they are likely to consider your request.
However, if the potential employer comes back with a lower offer, it’s important not to take it personally, or seem ungracious, as this could sour your future relationships with the organisation and the hiring manager. Instead, try to find out if there are any other benefits that could be offered in lieu of more pay, such as income protection/salary continuance, bonuses, pay reviews etc. This will make your overall salary package more valuable.
Asking for a pay rise
Nobody enjoys the thought of salary negotiations, but there are ways to make the process easier. For a start, don’t spring it on your employer randomly – wait until your pay review is due, or if your employment circumstances change, such as a promotion or increased responsibility.
Be open about the fact that you are asking for a pay rise, have a grasp of what the industry is paying, and be realistic in what you are asking for. You should also be prepared to give your employer time to think it over. It’s never a good idea to make ultimatums such as threatening to leave if you don’t get a pay rise, as they may call you on it. Even if they don’t, ultimatums are confrontational and being so they will harm your relationship and weaken your bargaining position.
It’s important to be able to justify why you feel you deserve a salary increase. If you’ve taken on increased responsibility, achieved a particular success on a project or completed additional training/education, these should be given as reasons. This will be viewed much more favourably than bringing in negative emotions such as “I’m not happy with my pay” or “Joe Bloggs gets X”. This can make it sound as if you don’t want to be there. It’s much better to keep the discussion positive and focus on how you have been performing, and what value that brings to the company and its performance.
Whether you’re negotiating salary for a new job or an existing one, it’s vital to ask rather than demand. Know your worth – but be prepared to prove it!