How much to expect in a yearly raise?

April 28, 2009 1:06 PM

I have my first "real job" annual review/raise coming up. I have never done this before. I'm looking for advice on what to expect and what to ask for.

Here's the rub: I'm 25. For a variety of reasons, the job I've held for the last year is my first salaried, "real" job that I've held for more than 10 months. My annual review is on Friday and we'll be discussing my performance (Which is more than adequate, but more on that below) and a raise in pay.

My concern is that when I was hired I was a totally unknown quantity. I took a somewhat low pay offer because I was desperate and because I had preciously few references in the field. I was initially hired as a marketing grunt. I did a lot of background research for campaigns, wrote some copy, executed a few web campaigns etc etc. I also put in after-hours and weekend work at events. As time went on, I gradually evolved into the web guy after it was discovered that I knew more than a fair shake about coding on the web. That job eventually grew and grew to the point where I was running all of our social media ventures, coding PHP/SQL databases for odds and ends work, relaunching our website and, now, implementing a new e-commerce software platform while simultaneously integrating that platform with a new and expensive and complicated ERP-backend. And doing the design work for these. And, oh yeah, I'm still doing weekend/after-hours trade show work, still doing marketing grunt work. I feel like I have two jobs.

But whatever. It could be worse! The problem is that my pay (About 18k, after taxes) is no longer consummate with the work- both quantity and quality- that I'm doing and is very, very much not on par for New York City. My wife and I are used to be being broke, we make ends meet, but I'm in a position now to get a little bit more and I'm not sure how much to ask for.

First of all, my boss loves me. I'm always the first to volunteer for a goofy detail no one else wants (I once wore the mascot costume when our usual mascot fellow was a no-show), I have a generally upbeat spirit and I do good work. I'm 100% confident that a review of the work I've done will come up positive.

I'm also in a position where. To finish the ERP work, at the contracting company's rate, would probably cost $15-$25000. They're very expensive. Now, I'm not going to ask my boss for a 15,000 raise, as much as I might think I deserve it. But the usual 2-3% figure I keep seeing quoted seems incredibly tiny, useless and untenable. I'm already considering a second job- I might as well just get a new primary that pays better.

So, I suppose the question is: What are the politics here? How much is it reasonable to ask for? Will asking for a crazy number (5000? 7000? ONE MILLION DOLLARS?!) make me look like a loon and damage my relationship? I'm not sure what people usually get, so I'm not sure what's sane. My dilemma is that I got hired for one job, fell into another more difficult and time consuming job, and kept the same pay. I'm not sure how to bridge that divide without looking greedy.

FYI: The payscale in this company is a little wacky. There are essentially 3 of us on the bottom of the totem pole, earning between 20 and 30 pre-tax. There are 2 mid-level folks earning between 40 and 60. The other 3 probably sit somewhere above there. (It's a small company and we used to have a very loud mouthed accountant. I know more than I should.). Also FYI, this is 9-5:30 gig, lots of extra hours, comp time, but no extra pay. We pay part of our own health insurance (About 15-20$ a week), no dental, 401k matched (Harhar, if you have money left for it!), no Christmas Bonus, 5 days paid vay-cay (Well. One of us has 6 weeks. This is another negotiating point.). No real perks otherwise, we don't get a lot of those "miscellaneous" holidays off (Columbus Day, Martin Luther King Day, Christmas Eve,New Year's etc.), so while it's a small company, it's not a Web 2.0, foosball for 3 hours in the afternoon kind of place.

Okay. I think that covers it. I'll peek in from time to time if anyone needs clarification.

posted by GilloD to work & money (23 answers total)

There is certainly no problem at all asking for what you think you are worth, but you'll be really lucky to get it, the time to get big bumps in salary is when you change jobs.
posted by zeoslap at 1:16 PM on April 28, 2009

As an addendum, you could phrase this as more of a promotion/job title change, and angle the salary change in with that.
posted by zeoslap at 1:17 PM on April 28, 2009

You make a pretty good case in your first big paragraph.

A review should cover how you have done, what you are doing well, what you need to work on, what you need to accomplish/learn in order to get promoted and so on. It should not just be about money.

Where do you want to go in that company? You can make suggestions on how you see yourself fitting in and contributing. If you require more education to get promoted, will the employer pay for necessary courses, or at least allow you time off for the courses?

You can probably get a feel for salaries in your area by checking job postings or contacting a recruiter.

You might also ask for a bonus, if you feel you have delivered above and beyond. This would redress your issue of being underpaid over the last year.

Most of the companies where I have worked have the employee and the boss fill out the requisite forms and exchange them prior to the meeting so that there is time to consider the input. I would suggest that you do that, even if your boss doesn't. At least that way, it will give him/her a heads up. If it is a small company, then it is likely that there will not be much structure to the review. So take the initiative and write something up: what you have accomplished, what you want, what you aspire to.

Good luck.
posted by PickeringPete at 1:22 PM on April 28, 2009

I don't remember where I heard this, but I once heard that the rule of thumb for the maximum raise you could expect in one year while staying with the same company is 15%. That may have come from the big company I worked for right out of college.

I think your negotiating position should be from the "my job has changed" angle though. The salary calculator at Indeed.com says a web developer in NYC makes $98K a year.
posted by COD at 1:27 PM on April 28, 2009

Oh my. For what it's worth, I'm not likely to remain in this position forever. It's not really what I want to be doing as much as what I feel into. I'm just looking for a little extra money to. Well, I can't do any work at home because my 6 year old Powerbook is on it's last legs. Or maybe I'd like to take my wife out for dinner once or twice a month. I've had the same shoes for two years, I'd kind of like a new pair. Just stuff like that, a little breathing room. But, of course, more is better, sort of.
posted by GilloD at 1:34 PM on April 28, 2009

Yeah, that's pretty low (gross pay is about $23k or so, right?) for the amount of technical skills you're contributing. Even uncertified, you should be making somewhere in the low 30k range at entry level. Depending on where you live, industry trends, etc., that can vary some. Asking for a $7k raise and a week or two more vay-cay wouldn't be crazy, though. Have some alternate benefits in mind in case you're hit with a "we don't have room in the budget" stuff, like a reduction in duties you don't like or workspace improvement, quality-of-work-life and the like.

Document specifically what you've done that would have been freelanced/contracted out, and the kinds of forward-thinking plans you'd like to accomplish in the next year. Your adaptability and quick-study-ness, especially in a small organization, is priceless and unique.

DON'T mention confidential details like "but person x gets $y per year!" That's unprofessional and is going to provoke alot of unwanted questions.

I'm in a similar position in that I was hired to do crappy print production work and receptionist duties and have leveraged my self-taught design and software skills into much more interesting web and layout work, with nice bumps in pay without even needing to ask. It takes a little while for management to explore the skill boundaries (or lack of limitations!) that an employee might have, so don't be disappointed if you don't climb several tax brackets in one performance review.
posted by cowbellemoo at 1:44 PM on April 28, 2009 [1 favorite]

Based on your description you're making 30-50% of what you could make elsewhere (assuming you could get a job elsewhere). Your best negotiating position would be to have something else lined up before you go to your review but be prepared to move, but it really sounds like you're being taken advantage of massively. You could be making a lot more money (for a lot less money) but your company probably aren't in a position to give you the raise you deserve.
posted by missmagenta at 1:44 PM on April 28, 2009 [3 favorites]

I'm currently 25 and in my first 'real', salaried job. I'm in year two, and my first raise [last year] was 14.4% Now, given the economy, I'm not sure what [if anything] to expect this year.

Agreeing with everyone that duties have changed and increased, and your salary should as well. Talk to the boss, mention the slide into your current position, the cost of contracting out to someone else the work that needs finished, and go from there.
posted by alynnk at 1:47 PM on April 28, 2009

What worked for me was getting some data on what the average salary was for a job like mine in a company like mine. And while my bosses couldn't make up the $20k difference between what I was being paid and what the data said I should be paid, they got me a quarter of the way there (plus a bonus) with the understanding that we'd close the gap in time.

Cold, hard numbers are your friend.
posted by katieinshoes at 1:48 PM on April 28, 2009

I also agree that it is hard to get a company to agree to give anyone more than a 15% raise.

It's also common thinking that the first year is largely training -- the fact that you are a bit of exception notwithstanding, most companies are not going to want to set a precedent for being willing to award a high raise within the first year of a young employee's tenure.

It would be reasonable, non-loony, and completely justified to put forth that you should get a title change, promotion, and raise. If I were you, I'd try for 10%.

The problem is that my pay (About 18k, after taxes)

...seriously, don't discuss your salary in "after taxes" amounts. Everyone pays taxes and it's a given that if you make XX,000 a year, you take home considerably less; to discuss your post-tax take-home is going to make you sound very young.
posted by desuetude at 1:54 PM on April 28, 2009

I think you should approach this as a negotiate-your-pay-from-scratch situation, since your responsibilities have changed so much. In NYC, if you're at all competent at the duties you're talking about, you should be making double your salary, easy.

I don't remember where I heard this, but I once heard that the rule of thumb for the maximum raise you could expect in one year while staying with the same company is 15%.

I wouldn't go by that- it depends highly on your base. A $30->$34.5k raise is much different from a $60->$69k raise.
posted by mkultra at 1:56 PM on April 28, 2009

FWIW:

When the review starts, focus first and foremost on your performance. You do a good job of highlighting your contributions, and your service, above and beyond the call of duty (doing 2 jobs, out of core hours work, etc.). Go through your contributions. Challenge your boss, what hasn't he been happy with your performance? ('what could I do better? how have I disappointed you in the last year?').

If your boss then says, 'oh you do such a good job, we're glad to have you', you then move towards the salary discussion.

Tell him candidly what you say here ('I'm doing 2 jobs, I feel my pay is no longer consummate with the work- both quantity and quality- that I'm doing and is not on par for New York City', and 'I really like working here, it's so much fun, and you're a great boss ... but you know, I'm afraid it'll reach a point where I won't be able to afford to work here anymore.').

Don't mention that you and your wife are used to being broke. If anything emphasize that this salary really isn't something you can use to be a provider for your household nor is it something you can start a family on.

Getting other salary information - either what others in the company in similar positions are making, or others in the same field - is a very big plus. If you can substantiate that a web expert earns $X per year, and you're doing that very job, that will help.

If your boss says he can't pay you more because of specific deficiencies, then have him document them - and then go about and fix them. Then, a few months later, you re-approach him and say, 'ok, I fixed all these problems, now give me a raise'.

Keep in mind too, that a skillfull boss sizes up his people and figures out what they need and services them appropriately. Some employees are very concerned about salary. Others want recognition. Some want a fun workplace. Perhaps he sees you as someone not worried about money but more interested in the social aspects of the workplace and is trying to make things fun for you. You in turn need to communicate that compensation is a concern of yours as well. Don't be ashamed to bring this up.

You can also use this venue to discuss your career path. Bring up the big bucks. Ask him, how you can eventually work towards one of those $60K per year positions. Map out a plan for the two of you to move your career forward to that goal.

And in the future you may need to start saying 'no' to the really grunty work. Setting up an E-commerce system is a substantial activity, a substantial skill. Putting on a mascot costume for instance, isn't. (OK you helped them out in a pinch, but you know what I mean). As such you may need to start picking and choosing where you get committed and focus on the tasks that move you towards the higher salary actions, or even narrowing your job description - so you're working on one job, not two.

I am rambling here but you may need to bring this up in your discussion too - of narrowing your focus to activities that give you a career path. But for that you yourself need to decide where you wish to end up.

And stop letting them take advantage of you.

Just my ideas.
posted by thermonuclear.jive.turkey at 1:56 PM on April 28, 2009 [1 favorite]

If you want a significant raise, you are going to have to prove that you are now doing a different job than what you were hired for. Sounds like you are, its the proving part that's hard.

Could you propose a change in title? From "Marketing Guy" to "Web & Marketing Manager"; whatever is appropriate to your workplace. Creating a new position is what will allow you to get a significant raise, otherwise you'll stay in the same range as the other 2 you mention at the bottom of the totem pole. You are not going to get anything beyond 2-3% by just being really really good at your job.

By the way, your current pay sounds fucked up. That is crazy low for NYC - I don't have any idea how you can survive on that anywhere near the city. If your company is willing to pay that to someone as valuable as you sound, you may want to consider looking elsewhere, that sounds very, very screwy.
posted by RajahKing at 2:00 PM on April 28, 2009

DON'T mention confidential details like "but person x gets $y per year!" That's unprofessional and is going to provoke alot of unwanted questions.

I don't agree. I had a situation like this. I learned another person, in a similar position but with perhaps a bit more background than me, earned $y and I earned less. So I went to the manager, and said OK, I know person A earns $y, and I don't, but that's OK, I understand he's more senior than me. So, tell me what I need to do to earn that salary. Where do I need to improve? What skills do I need to cultivate?

The manager couldn't give me a straight answer because in spite of the other person's broader background, we were doing equivalent work and he was, on the whole, satisfied with my performance.

Yes, some questions were asked, but I got a big raise out of it.
posted by thermonuclear.jive.turkey at 2:00 PM on April 28, 2009

You need comparable salaries for similar jobs at other companies. Frame it as job title change and salary negotiation based on that. Bring 4-7 comparable positions to show them.

If they were to go out and hire someone doing the same job as you, even in this economy, they'd be paying more. Show them that.

Off the top of my head, taking in your current salary (folks aren't likely to jump a huge amount in one year), the current economy, and your apparent ability to negotiate, I'd suggest at least $30k and some other benefits - another week vacation, possibility for a bonus, etc.
posted by barnone at 2:07 PM on April 28, 2009

DTMFA.

Your compensation is comical. Your boss may love you, but as long as s/he doesn't show the money to show it, then you're clearly not worth it to him/her.
posted by trotter at 2:45 PM on April 28, 2009 [3 favorites]

You are considerably undervalued. Find some comparable listings for jobs. Use a site like Monster.com to find a specific position that fits what you do, and you should be able to find a range of what that job should pay in your area. I have found their estimator to be quite accurate for positions where the person is valued.

What you are being paid now is about what I was making at age 22 working at a call center during the last recession. You are clearly doing much much more than working at a call center, and live in an area with 2-4x the cost of living where I live.

During your review, let them express how valuable you are. Then let them know you expect to make more. And a lot more, not a little. Be able to express the value you bring to the business. My last raise was 60%. Before that was 30%. Same company, and when I got the 30% raise they told me that was the absolute most they could possibly ever give someone, which clearly turned out not to be true.

If they tell you "no, there's no possible way we could ever increase your pay by more than 5%," you need to start looking for another job. Find another job that pays well. Interview, get an offer. If you really want to stay where you are, take that offer to your current company and see if they'll match. I have done this twice, successfully, with the same company, as I love working here. If they won't match, leave.
posted by MonsieurBon at 3:04 PM on April 28, 2009

Like others have mentioned, you should argue that you are are in a new position with new responsibilities, and thus should get a job title change. A job title change means that you should be eligible for a much larger raise (whatever is commensurate with the title in your company or on par with the industry standard).
posted by formless at 3:45 PM on April 28, 2009

I think you lay out your argument well. Please don't do two things:

- Talk about other people's pay. This will get at least one person fired. And it's a small office, so it won't take long to figure out who said what.

- Give reasons (like, I need new shoes) for your pay increase. It does not matter if you need it to buy medicine for your dying mother, or if you want to light it on fire and throw it out the window. You work for money. You do not need to ever apologize for that, or explain it in terms of your expenses. Working for money is not greedy. Once you explain a pay-increase request with personal accounting, the discussion becomes one about your expenses, not your pay. And, it makes it seem as if you will always be ok with just scraping by and breaking even.

Now, some bad news. I don't think they will give you an increase to bring you to what you could make on the market. I do think you can get yourself a good increase, though.

After thoroughly discussing your pay increase, then try to negotiate any other pay-like things:
- Paid time off (vacation)
- Tuition reimbursement (if you'd like to go back to school), training budget (if you'd like to get some training and certifications)
- Equipment for your home office. If you are working long hours, and would feel more comfortable doing those after-hours hours at home, you need a laptop.
- Commuting expenses, if they are anything but negligible.

Then, after discussing pay increase, and then other pay-like things, negotiate quality-of-life things: Flex hours, 9/80 workweek, etc.

(And oh yes: The person who was eager to tell you everyone's pay scale? She will tell everyone about your pay increase.)
posted by Houstonian at 3:46 PM on April 28, 2009 [1 favorite]

I should add, if you can before the meeting, try to quantify your worth to the company in dollars. Has your work made or saved them money? How much? Have this written up so you can hand it to your manager for review. It's a compelling argument.
posted by Houstonian at 3:54 PM on April 28, 2009

18 grand net when only one project you're doing would cost them $15-25k? This is called exploitation. Play hardball. If it will cost them 15-25k if you leave, you should ask them for at least 15k. Don't be nice, be direct and clear about your demands.

And start looking for new work right away.
posted by hamsterdam at 4:30 PM on April 28, 2009

I would recommend looking for jobs and lining up interviews. Your pay is comically low for technical work in NYC (office assistants make more than 30-40k a year). You deserve a raise of (at least) $15,000, but the challenge is in figuring out how to get it. Try to get another job lined up and see if your boss will match their offer. If not, run, don't walk, to the new job. Nobody should be paid that little in NYC.
posted by eisenkr at 9:06 PM on April 28, 2009

Not much to add, but Nthing the thoughts that this is best a conversation about a new title and salary that appropriately reflect your responsibilities and the quality of your work.

Also Nthing the thoughts about getting some clarity on salaries for reasonably comparable positions in your area. As fate has it, the ongoing browsing session has included some time at glassdoor.com, potentially a good resource for salaries (and insights on potential places of employment).

Assuming your boss is not an dolt, he or she realizes you: have valuable skills; a good attitude; are grossly underpaid; are not clipping along, doing good work as per a job description and stepping up when need be; would stand a respectable shot at getting a job with dramatically higher pay, even in this day and age, along with a realization that the company would lose a lot if they lose you (at least in terms of the time it would take to get a replacement, the replacement getting up to speed--if the replacement is good), could not replace you for anything close to what you're making.

That said, as a friend once commented, management everywhere is bad; why do you think Dilbert is so popular. It would not be flabbergasting if the decision-maker(s) choose not to give you a massive raise. "Choose" as opposed to "can't."

Not clear if your boss is the owner, there are people above him/her. If your case boils down to "I was hired as X for Y, but now I'm an A and average salaries are B," it doesn't fly and there are people or a person above your boss, it would feel reasonable to ask to discuss the matter directly with the person or people above.

Those things aside, if there's a far-from-looooooooooow chance that you can get a job that pays 2x this one or more--and at low 20s, going to 3x seems possible--there is a serious amount to be earned (and spent on fun, equipment, saved, some or all of those things) even if your circumstances mean you won't be working in 10 months.
posted by ambient2 at 2:11 AM on April 29, 2009