When working with job recruiters, you should be aware of recruiter tactics for lowball salary offers during job salary negotiations. Recruiters are employers’ personal shoppers, tasked with going into the marketplace and bringing back the best qualified candidates for the thriftiest prices.
Recruiters are sales professionals, not your new best friends. This is true when:
The recruiter is an external recruiter (a.k.a. third-party recruiter or independent recruiter).
An external recruiter is employed as a retained recruiter on an ongoing basis and is paid a set fee — much like a retained lawyer or accountant.
An external recruiter is employed on a transaction basis as a contingency recruiter and is paid only when a submitted candidate submitted is hired.
The recruiter is an internal recruiter (a.k.a. company recruiter), who is staffed in a company’s human resource department and paid a salary.
All recruiters are engaged by employers to find people for jobs — not jobs for people. And they do it by being superb sales professionals. Recruiters who deem you qualified for a position pass you up to a hiring decision-maker, often the individual to whom you would report.
Tactics meant to sell low offers
When a company gives a recruiter a limited compensation budget to offer candidates, the recruiter’s job and livelihood depend upon convincing you, a qualified candidate, to take the “downpay” job offer by pointing out collateral benefits the job may or may not truly offer.
The consultants’ suggestions include the following sales techniques and talking points:
Offer “exploding bonuses” that shrink in amount the longer you take to consider the offer. (Don’t give candidates too long to think about accepting a job that pays under market.)
For a management job, invite comradeship with the company CEO, who calls asking you to accept the offer, commenting that “You and I can build this company together.” In a variation, a potential coworker calls urging you to “Join the team — it’s great.”
Make a great “higher-calling” offer. This includes such rewards as a title, telecommuting, training options, a socially responsible and environmentally friendly employer, working with new technology, and the opportunity to make a difference in people’s lives rather than “just making money.”
Reframe the discussion by speaking less of cash compensation and benefits and more of job stretch and growth opportunity.
Job stretch describes an environment in which you show what you can do on a larger stage — heftier operating budget, bigger challenges and supervision of more employees.
Growth opportunity is the lure of future raises, promotions, and company growth.
Who wins, who loses on a lowball offer
When you’re working with a contingency recruiter who encourages you to take less than the going rate for a job, the recruiter may have your best interests at heart. Or the recruiter may just want to close the job order quickly.
A contingency recruiter’s fee is based on your first-year earnings. Follow this oversimplified example: Say the recruiter is to be paid 25% of the job’s first-year salary. If the job’s market rate is $100,000, the recruiter would earn a $25,000 fee. But when the job’s budget figure is under market — say, only $90,000 — the recruiter takes a hit of $2,500, compared to your loss of $10,000.
From the contingency recruiter’s viewpoint, most of a loaf is better than none. And the recruiter hopes for future assignments from the employer that can more than compensate for losing a relatively few dollars on a single transaction.