Do You Think You’re Underpaid? So Do One-Third of American Workers
How does your salary compare to your work bestie’s? If you’re like 32% of Americans, you believe you’re underpaid compared to peers in similar roles and industries. That’s what resume-building website Zety’s recent Pay Gaps & Perceptions Report discovered. And if you fall into this group, you might not know what to do if you’re underpaid.
This data comes at a time when workers are more comfortable than ever discussing salary with their peers. Traditional workplace etiquette says you should never discuss salary with your coworkers. Still, over the last few years, workers have started calling for more pay transparency. In fact, according to Zety’s report, 88% of employees are open to discussing their salary with their colleagues. In comparison, only 12% think having that conversation is risky or inappropriate.
The report also found that only around half (55%) of workers are confident that their salary is based on merit and performance rather than their employer’s biases around gender, race and ethnicity. And 77% reported reduced workplace productivity or engagement caused by salary dissatisfaction. It’s a sign that being underpaid affects the company’s bottom line and your own.
If you’re wondering what to do if you’re underpaid, you’re clearly not alone. Here’s what you can do to ensure your salary reflects your worth.
What to Do if You’re Underpaid
If you suspect you’re underpaid, the important thing is to remain calm and try not to let any negative emotions impact your day-to-day work or your relationship with your coworkers. Instead, put that energy toward building a solid case for a raise with your current employer or a new job elsewhere.
First, research the average salaries in your industry to get a baseline range. However, don’t assume your salary is lower than your colleagues’ just because you see a higher average salary for your position listed online. Many factors like location, industry and experience impact your salary.
In Zety’s report, 38% of respondents reviewed salary bands or job postings for data before attempting to negotiate a raise, 37% researched market rates and 34% used online salary calculators.
Next, consider your responsibilities. Has your boss added tasks to your workload over the last few months without increasing your compensation? Do you have more responsibilities than your colleague who earns the same salary? Gathering this information can help you decide which steps to take next.
Finally, ask your HR department if they’ll provide you with a salary range for your position. In some areas (including California, Washington, Minnesota, Colorado, Illinois and New York) companies are required to publicly provide this information, while in others, they are not obligated to comply. You can also ask colleagues in similar positions to share their salaries with you if you both feel comfortable doing so.
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How to Negotiate a Raise
Once you’ve researched salary and confirmed that you’re likely underpaid, it’s time to schedule a meeting with your boss.
Negotiating a raise can be intimidating, especially if you’ve never done it before. But it doesn’t need to be a scary conversation if you’re fully prepared. Follow these steps for a productive meeting about your current and desired salary.
- Prepare your case. You never want to enter a salary negotiation unprepared. Jot down details on your current responsibilities, workplace achievements and past positive performance reviews. You’ll use this information to make a case for a salary increase to your manager.
- Come up with a target range. Here’s where your previous research comes in handy. Look at the average salary range for your position, bearing in mind that you may earn less than the average if you live in an area with a low cost of living and more than the average if you live in an expensive city or metro area.
- Prepare a presentation. Here, you’ll list your proudest achievements from your time in this role. Consider your presentation a sales pitch on why the company should invest in you. Create notes to keep your conversation on track, but aim for a natural conversation rather than reading directly from your notecards.
- Practice your pitch. Enlist the help of your friends and family to listen to your pitch. Try to find people in your circle with management experience who may have been through this process in real life. Ask for feedback and adjust your presentation as needed.
- Schedule a meeting. Once you feel ready, ask your boss for a meeting to discuss your position and performance. If possible, time the meeting for the middle of the week (and the middle of the day) when you’re more likely to have their full attention. Additionally, schedule the meeting soon after you’ve completed a significant project that adds a tangible benefit to the company. This might include signing a new client or achieving a sales goal.
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When to Start Looking for a Higher-Paying Job
In an ideal world, your boss will agree you deserve a raise, and your human resources department will approve the increase. However, in reality, you might leave a salary negotiation meeting feeling dejected if the answer to your request is “no.” If this happens, should you stick around or start looking elsewhere?
Consider the non-salary benefits of your current job. If you feel overworked and underappreciated, the low salary might be the kick you need to find a new job with a better salary. However, if you like the company, have a flexible and understanding boss, have potential growth opportunities and enjoy a good work-life balance, your salary might not seem as important.
If you do decide to apply for new jobs, avoid checking out from your current one. The job market can be tough, and it may take several months (or longer) to get your next job offer. If you let negative emotions overwhelm you, your performance at your current job will suffer and you might be sabotaging your chances of future promotions or pay increases.
A Final Word on What To Do If You’re Underpaid
Wondering what to do if you’re underpaid is common. Typically, the only way to get more money is to ask, and if the answer is no, it might be time to try to move on. Ultimately, you’ll need to decide the most important factor for you. And even if you choose to stay in your current role, there’s no reason you can’t check out other jobs in your spare time. You never know when your dream job will become available.
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Catherine Hiles is a Certified Financial Education Instructor and freelance writer specializing in personal finance and home improvement. She lives in Ohio with her husband, two children and two energetic dogs.
