In short, you should include in your job application as high a salary requirement as you can reasonably justify. I’ll explain the “why” in a minute—but first, let’s talk about the “how.”
Do your research to get your number—learn as much as possible about the position and comparable salaries from local and industry sources and job sites such as glassdoor.com. See if you can get any insider information, too. Try looking for salary information on the company’s website.
You’ll likely come up with a range, and you should put the highest number in that range that applies, based on your experience, education, and skills. And yes, that’s a little aggressive—but bear with me.
Next, I recommend writing “(flexible)” or “(negotiable)” next to your number. Now, I realise that making an aggressive initial offer can be a scary proposition. So let me explain the reasoning.
First, when the value of an item is uncertain—as your services to a prospective employer are—the first number you put on the table acts as a strong “anchor” that will pull the negotiation in its direction throughout the entire bargaining process.
Professor Adam Galinsky of the Kellogg School of Business at Northwestern University has explained the anchoring phenomenon this way:
Items being negotiated have both positive and negative qualities—qualities that suggest a higher price and qualities that suggest a lower price. High anchors selectively direct our attention toward an item’s positive attributes while low anchors direct our attention to its flaws.
By stating a salary requirement that is lower than your prospective employer might be willing to pay, you not only cheat yourself out of more money, but you might come across to the employer as unsophisticated or unprepared. By stating a salary higher than they might be willing to pay, you risk little harm, so long as you indicate that your salary requirements are flexible. And at the same time, you are communicating that you already know your skills are valuable.
Just as important as anchoring high, the second benefit of giving a number at the high end of your range is that you give yourself enough room to negotiate if you are offered the job.
Research has proven that people are happier with the outcome of a negotiation if their bargaining partner starts at point A, but reluctantly concedes her first couple of requirements before saying “yes.” So, by stating an initial salary that leaves room for negotiation (I recommend room for at least three concessions or back-and-forth conversations), you’re more likely to get what you actually want.
The three major pieces of advice on negotiating are these:
Don’t be afraid to be aggressive: Research shows that people typically tend to exaggerate the likelihood of their bargaining partner walking away in response to an aggressive offer and that most negotiators make first offers that aren’t aggressive enough.
Focus on your target price: Determine your best-case-scenario outcome, and focus on that. Negotiators who focus on their target price make more aggressive first offers and ultimately reach more profitable agreements than those who focus on the minimum amount they’d be satisfied with.
Be flexible: Always be willing to concede your first offer. In doing so, you’ll still likely get a profitable deal, and the other side will be pleased with the outcome.
Remember, there’s little to risk if you put the highest number you can justify, but there’s a lot to lose if you don’t.