How (and Why) to Ask for a Raise

A family member asked me for my thoughts on asking for a raise, and after a handful of massive text messages, I decided I should probably just write a blog post.

Before I get into it, one disclaimer: My working experience is entirely confined to small businesses. If you work for a megacorp, for instance, salary discussions probably look entirely different (and are probably tied to an annual review or something). My experience is limited to places without any type of formal process in place.

Why ask for a raise

Fundamentally, your relationship with your employer is a business deal. You have no obligation (aside from whatever the legal minimums are) to them beyond what you agree to, and you can rest assured that they feel no obligation to you.

You work for them because you like the money, or the hours, or the environment, whatever.

In turn, they pay you to do a job because they like the deal they’re getting—they like the price-to-performance ratio they get from paying you.

So, when your performance improves, it’s reasonable that the price for your work should go up too—especially if you can make the argument that they’re still getting a good deal.

Why people don’t ask for a raise

Most “normal” people—people who aren’t in managerial positions—are uncomfortable talking about their compensation. They’re even more uncomfortable negotiating their compensation. It feels “grimy” or “greedy” or something. Managers, in contrast, feel none of this discomfort—this is business, after all, and negotiating is what they do!

(I’ll leave it to the Marxists to argue that this imbalance is a conspiracy on the part of the capitalists to keep the workers from receiving their just deserts, etc. Even without an evil conspiracy, though, it’s certainly the case that managers take advantage of employees discomfort by not helping them feel comfortable with these discussions. After all, if you’re uncomfortable asking for more money, that’s money they’ve saved!)

So the first barrier to getting a raise is simply to not let your feeling of awkwardness dissuade you from bringing it up. Your manager probably isn’t going to offer, but they certainly won’t be insulted by you asking. (Again, they understand it’s a business deal.) To the extent that you feel like a used car salesmen or something, you need to let that go. As a “business,” you have a responsibility to your “shareholders” (wife? kids? friends? dog?) to get the best deal possible.

When to ask

I suggest asking for a raise at least once a year, but there are two events that should trigger you to ask sooner than that:

  1. Your responsibilities change (and you suddenly and clearly deserve a pay bump).
  2. You finish a big project (something above your current pay grade), and you’ve thus proven that you’re capable of higher-caliber work.

Evidence you should present

When you’re making your case for why you deserve a raise, I suggest bringing up any of the following that apply:

  • What measurable impact you’ve had on the company—hard numbers are king!
    • This is one of the most difficult bits of evidence to get (a lot of roles might not have clear business metrics), but if you can get creative and find some hard numbers, it’s one of the most powerful arguments in your favor. Things you might consider:
      • Increased sales by $x
      • Reduced costs by x%
      • Improved customer retention by x%
      • Improved customer satisfaction from x out of 10 to y out of 10
  • How much you’ve knocked your projects out of the park since you & your boss last evaluated your pay—it’s a lot more effective to say “pay me more because I’ve done great work” than it is to say “pay me more because I intend to do great work in the future”!
    • Protip: It also helps if your boss has been hearing about how much ass you kick all year, so that when you pull out your list of accomplishments, they’re nodding along, rather than thinking “wait, I never saw that.”
  • How much experience you’ve gained (and thus how much better you are at your job)
  • How much more responsibility you’ve taken on
  • What the market would pay for a person of your experience/expertise/education/job title/etc.
    • Sites like Glassdoor can help estimate this, but even better is to talk to other people in your industry—you might find that the Glassdoor values are quite low!

And, finally, the scariest (but most important!) item:

  • How much you’d like the raise to be.

This last one is important because it helps anchor the discussion to amounts you think are reasonable—you don’t want your boss to say “sure, you can have a raise… how’s $0.05/hour sound?”.

How much to ask for

This depends heavily on the evidence you present (above). If you’ve suddenly become critical to the business, or your pay is low relative to the market, you should ask for more than if this is just a general “I’ve gained another year of experience” raise. As a lower bound, you should at least be getting a cost-of-living increas each year. (Inflation these days is between 1 and 2%, so if you made $d this year, you would need to make $d × 1.01 next year just to make the same amount in “real” dollars.)

And of course, always start high, and be willing to be talked down. If you won’t be happy with less than +5%, ask for +7% or something. (You might even get it!)

[Aside: In the past, I’ve actually been transparent with my boss about what I’m doing here: I’ve said things like “I’d be thrilled with 8%, very happy with 5%, and okay with 3%.” I’m not sure whether this is brilliant or idiotic. In my defense, though, I was very confident that my employer wanted to keep me happy—they had a long history of paying people what they were worth. (Because that’s the only rational thing for them to do! It’s incredibly expensive for them to lose a good employee and have to hire & train a new one!)

For what it’s worth, I wound up getting my median “ask.” Again, not sure if this was brilliant or idiotic.]

Prompting the discussion

I really prefer to have these discussions in person—people’s eyes tend to glaze over if you send them a 12 paragraph novel of an email detailing all the bullets above. So instead I just send an email just to initiate that discussion. (This is much nicer than just dropping in on your manager and initiatiating the discussion now, because it gives them time to prepare—look at the budget, look at your last year’s performance, whatever they need to do.)

Here’s an example of an email I might send—it’s short and direct.

Hi boss,

This month marks my two year anniversary with [the company].

Can we schedule a time for a “performance review” and to talk about my salary? I think an additional [dollar amount/percentage] is reasonable in view of [super, super brief summary of your strongest bullet points, like “all the new responsibilities I’ve taken on” or “my performance on that major project”].

Would [day] at [time] work?

Thanks!

— Tyler

And of course if your boss doesn’t get back to within a reasonable time frame (a week, maybe?), you send a followup or ask in person to schedule a time to talk.

What to do if they say no

In general, you’ll only get a flat refusal if either

  1. the business is run by idiots, and they can’t see your value, or
  2. you’re actually not as valuable as you think you are to the company.

There’s a third possibility: “there’s no money in the budget” or some similar excuse. Personally, I’d consider this bullshit and treat it as an instance of one of the above.

(Let’s assume you’re awesome, and you’re in bucket 1!)

At this point, you have two options:

  1. You start thinking about your “best alternative to a negotiated agreement” (BATNA). In most cases, that means you start looking for other jobs.
  2. You ask your boss what it would take to make them say yes. Your goal here is to get clear goals for the coming 3-6 months, in writing, so that after that time, you can come back and say “you said I would need to do x, y, and z if I wanted a $d raise, and I’ve done that, so pay up.”

I suggest doing both.

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