With inflation at a 41-year high, you should be asking for a raise — here's how to do it
When asking for a raise, everyone knows you should focus on why you deserve one, not why you need it.
But what if your biggest argument is that you need it?
Inflation has hit a 41-year high, and many Americans fear wage growth isn't keeping pace with price surges. In a recent survey of more than 1,000 US workers by staffing firm Robert Half, nearly 62% of respondents said they plan to ask for a raise this year, with the top reason being to adjust for the higher cost of living.
Fortunately, there's a way to work inflation into your raise request. The labor market is still hot, so many companies are focused on retention to keep employees from walking.
Here are 6 steps toward getting an inflation-based raise:
Find out your employer's stance on factoring inflation into raises
Some employers may already account for cost-of-living increases when giving raises. If you're uncertain, you can bring it up in your annual review or after successfully finishing a project, says Tori Dunlap, a personal finance expert and founder of Her First 100K, a financial literacy platform for millennial women.
Dunlap suggests saying, "I've really enjoyed being a part of this team and am excited for my future here. I was wondering what is taken into consideration when giving raises. In addition to my overall performance, will the cost of inflation also be taken into account?"
If your employer doesn't automatically account for inflation, consult the Consumer Price Index to find the inflation rate from the past 12 months. Take that number in decimal form, add 1, and multiply that sum by your current salary to find out how much to ask for, says professional coach Brooke McCord of coaching company Ama La Vida.
Ask to discuss your pay
For many people, broaching the subject is the hardest part.
Dunlap recommends sending an email along these lines: "I would like to find a time where we can discuss my current salary. After doing some market research and assessing the way that inflation has affected my cost of living, I believe that an increase in my salary is appropriate. I really enjoy this role and this team and see myself being here for many years, so I would like to find a number that makes us both happy. What days and times would work best for you?"
If you have a review around the corner, you could tie your request to that.
McCord suggests: "I know my performance review is coming up and I'm looking forward to it. With my recent [achievement] and inflation, I'd like to discuss my compensation in addition to digging into what I'm doing well, where I can continue to improve, and how I can continue to grow within this team."
Do your research
Use sites like Payscale and Glassdoor to compare your salary to your industry peers. Take into account your geographic region and specialization, says Josh Doody, founder of Fearless Salary Negotiation and a salary negotiation coach for senior software engineers and engineering managers.
Compile accomplishments, praise, and positive performance reviews showing how you've specifically succeeded. Focus on metrics and concrete examples, and zero in how you've improved.
"The conversation you're having is, 'My salary was set sometime in the past, and now I feel like my salary does not currently reflect the work that I'm doing,'" said Doody. "You want to identify, what are the things you've been doing that you're not currently being compensated for based on how you agreed to be paid for your work, and what is the value of those things? That way, what you're doing is saying, 'Here's my target salary and the reason I chose that."
Focus on your value
Though inflation is part of the discussion, your achievements should be the cornerstone of your negotiations.
"You always want to bring it back to the value you add to the company," said McCord. "Focus on how you have helped the team and company achieve their goals."
Dunlap advises you provide concrete examples of your contributions before delving into inflation. At that point, try saying, "I would love to see what else I can accomplish in this role, but my current salary is not meeting the levels of inflation in this area. My costs of living have increased by X% in the last 6 months, so I would like to see my salary increase accordingly so that I can continue to grow and reach new goals with our company."
If you get a "no," it doesn't have to be the end of the road.
At that point, Dunlap suggests saying, "Thank you for having this conversation with me. I would love to set a time to revisit this conversation. Would the end of next quarter be a possibility? In the meantime, would you be able to give me some feedback so I can understand what you would like to see from me in that time in order to secure my desired salary?"
Remember that salary is just one part of compensation, says McCord.
"If they deny your request for a raise, ask about increased PTO, flex time, remote work, bonuses, equity," she says.
If you're consistently denied a raise, it may be worthwhile to look for work elsewhere. "If they are unwilling to budge and acknowledge your hard work, that might be a sign it's time to move on," McCord says.
This article was written by Sarah Jackson from Business Insider and was legally licensed through the Industry Dive Content Marketplace. Please direct all licensing questions to email@example.com.