When professionals move to a new position (both internally and externally) it is safe to expect a raise. However, there are instances when individuals are simply seeking a change of venue and are open to a new position without an increase in pay. The potential increase in compensation is often determined by a number of variables:
Supply and Demand
This factors into every single pay raise negotiation. If a client really needs a role filled and the supply of skilled professionals is limited, the amount you may be offered should be higher. Likewise, if the market is full of skilled professionals and you are one of many similar candidates, the salary increase will be lower.
Just like the economy, salaries and raises are influenced heavily by the market’s supply and demand. Before you commit to a new position (especially externally) you should discuss the market with your recruiter to determine expectations.
While this seems like a “no-brainer” (no pun intended), the experience a professional brings to a role weighs heavily on a potential pay increase. Truthfully, companies are willing to pay more for candidates that have more experience and skills. If a company feels that they will have to expend more resources to get you to the experience level they want, expect a smaller raise.
Play Your Hand
Negotiation often plays a large role in the raise a candidate could receive at a new job. Always remember that everything is a negotiation. If you have an experienced recruiter, you can expect to participate in some salary (and raise) negotiation, but you don’t want to overplay your hand. Clients are smart and they probably know you expect (and deserve) a raise, but they could be quick to call off negotiation if they feel you are pushing to receive more than your skillset and experience is worth
Lateral Move or Pay Cut
There are instances when professionals simply want to move out of their role—and they may be willing to make a lateral move or even take a pay cut. This is not as uncommon as you may think. Money by itself rarely buys happiness, and if an individual is truly unhappy where they are, they may be willing to move without financial incentive. The most common reasons for this are a better work/life balance, a shorter commute, or to escape a truly horrid boss.
Internal Pay Bump
If you are moving up internally at a company, it is reasonable to expect an increase in pay. However, the amount you can expect will vary based on the new position, responsibilities and the company’s internal policies. To be safe, an internal move on average yields a 2%-5% increase in pay, usually more if it is a promotion to a higher management level. There are of course outliers on both sides as well.
When you are selected or request an internal move, it is always advised that you discuss the specifics with your HR representative. There is no shame in clarifying the pay and benefits for a new role.
External Pay Bump
The most common question of them all—how much can I expect if I transition into a new role at a different company? The average is around a 10% increase. Most employers, recruiters and candidates find this amount fair. Remember though, this is not a guarantee by any means, as the position of both sides weigh heavily on this decision.
It is a candidates’ market currently as there are more jobs than candidates, particularly at the lower levels. This often means that salaries and pay increases will be higher when candidates are looking for a new opportunity. In Houston specifically, there is a high demand for skilled full-time employees and contractors.
If you have read this to the end and have gone through the suggestions to no avail, please give us a call at 713-357-9565. We want to give unbiased answers to your questions, whether you choose to engage our help or not.