With the new year here, many people may start searching for a new job. But money expert Clark Howard says this is also an opportune time to ask for a pay raise.
“2022 is the year of the pay raise from your employer,” Clark says. “And pay raises are likely to be the highest they’ve been in a long, long time.”
Why This Is a Good Time To Ask for a Pay Raise
Companies are setting aside nearly 4% of their payroll budgets for raises in 2022, according to a recent survey of 240 companies from The Conference Board, a New York-based business research nonprofit.
Here’s more positive data for workers: 97% of large U.S. companies are planning to boost salaries with the average raise being about 3%. The data come from a survey by human resources consulting company Willis Towers Watson.
How To Ask for a Pay Raise
Asking for a pay raise is one of those things that you should put a lot of thought into before you proceed. Here are some things to consider.
Make Sure Your Timing Is Appropriate
There are good — and not so good — times to ask for a pay raise. If your company or department has operational meetings, see if you can glean how the financial picture is looking for the business. Does the company expect record profits this year? Did the business lose money last quarter? Answers to those questions should dictate whether to ask now or wait a bit.
Another good time to ask? When you’ve aced a performance review, says jobs site Monster.com.
Monster.com career expert Vicki Salemi says you should also find out if there’s a formal period at the company when raises are given. A Human Resources representative should be able to tell you that window. If you’ve missed it, Salemi tells CNBC, “You still need to have that conversation, because it plants a seed with your boss and they may say, ‘You know, they are worth more. Let me see if I can do a mid-year raise.’”
Do Your Homework
Prepare yourself by looking up salary information for your position on job sites like PayScale.com and GlassDoor.
“You need to know what your value is in the marketplace. And you need to state the reasons to your employer — if they offer you a raise that you feel is too tiny — why you deserve more money for the work you’re doing,” Clark says.
Measure Your Words
How you ask for a raise can be as important as what you ask. “You can’t just go to your boss and be all demanding,” Clark says.
If the conversation doesn’t go the way you want it to go, keeping calm can be beneficial.
“Don’t ever get in a huff about it; you want to be polite,” Clark says. “Just be very clear why you feel you deserve more money than what you’re receiving from your current employer.”
To help you find the right words to say, jobs site Indeed.com has some scripts you can follow.
“If they just don’t want to listen,” Clark says, referring to your employer, “there’s a lot of opportunity out there.”
He’s right. Driven by a high demand for goods and services, the job market this year is poised to be very hospitable for job seekers.
If job flexibility is a key concern of yours, no worries. Many employers are offering jobs with flexible work schedules, including fully or partially remote positions.
Looking for a job? Read Clark’s Work-From-Home Guide.