|Let me preface this post by saying that you should be comfortable
negotiating a salary that is appropriate for the experience and special
skills you bring to an employer. You should never settle for an
outrageously low salary that you A) couldn't live on or B) is far below
the prevailing rate for that line of work in that locality.
However, many applicants are missing out on otherwise good job choices
because they are unrealistic about how much they think they should be
paid. Secondly, applicants fail to realize the costs an employer takes on
in addition to the salary they are paying. When an employer decides to
hire someone she must also weigh in the additional costs that come with
In fact it is not uncommon for the total cost of employing a person to be
40% more than their base salary. That means someone paid a salary of
$30,000.00 per year could actually be costing the employer $42,000.00
every year. These costs are not typically seen by the employee, but the
employer will have to pay them nonetheless.
Costs you may not see.
Examples of additional costs to an employer can include a variety of
payroll related taxes, paying someone to train you, paying for the
physical space you will need, travel reimbursement, retirement savings
match, parking, uniforms, specialty tools and equipment, health care, and
a variety of mandatory insurances.
Extra costs still sting more than before.
We are still not quite over what happened in 2008. All of these expenses
may be more burdensome now then they were 5 years ago. This plays into the
amount an employer can pay for a given position. That is a legitimate
reason why job seekers are finding the same type of work they used to have
but a less pay.
When considering the salary being offered to you remember to consider all
the other expenses to the employer that comes with that pay rate. This
doesn't mean giving an employer a pass just because they are cheap or
trying to low ball you during a salary negotiation. Rather, it is a
reminder to keep things in perspective given the realities employers face
when hiring people. MB
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