Landing a new job is hard, and it’s made harder by the power and information imbalance between talent and companies.
This is especially true in matters of compensation and negotiation. Not only do recruiters and hiring managers have the most leverage, but they also have access to compensation benchmarking data from companies like Radford and Option Impact, giving them full visibility into salaries across the industry. For talent, it’s often tough to complete. One way to correct that imbalance is to understand exactly what goes on with the company during critical moments of the process, so you can act accordingly. Here’s what you should know.
The recruiter asks, “What are your compensation expectations?”
There’s a lot of conflicting advice about how talent should answer this question when it comes up. Because it typically comes at the end of the initial qualifying call, applicants are often afraid of answering it honestly, fearing that doing so may disqualify them from consideration before they’ve had a chance to make a case for themselves. This is why a lot of the advice recommends punting on answering for as long as possible.
There are two key reasons why recruiters ask this question so early. Caroline Taylor, a recruiting manager at ed tech company Noodle Partners, said that recruiters want to know whether a candidate’s compensation expectations are within range of the role’s budget - just so candidates can avoid disappointment later on.
“If I know you are looking to make $50K over what we have budgeted, I want you to know that as early on as possible so if we do get to the offer stages, you aren't surprised,” she said.
This is similar to why recruiters are eager to know if candidates are in the late-interview rounds at other companies. Consider Netflix, whose compensation packages tend to be cash-heavy. Knowing that a candidate is in the final stages with that kind of company helps recruiters know whether they have the resources to stay competitive. This is especially important ahead of the onsite stage, which is the most expensive part of the interview process. “Knowing that a candidate is in the final stages or has an offer from that kind of company helps you weigh whether it makes sense to have someone come onsite at all,” said Mick Stallone, a former technical sourcer at Thumbtack who has recruited talent for Facebook and Twitter.
Some other possibilities:
- Sometimes, companies just don’t know what they want to pay
- In many cases, companies just want candidates to anchor low by putting out the first number
The recruiter says, “We just want you to have one more conversation”
What’s going on behind the scenes when this happens depends on where candidates are in the hiring process. If a candidate is pre-offer, then it’s very likely that they had a split interview panel, with one or more interviewers lukewarm on giving the green light.
When this happens, teams are typically figuring out where a candidate should be leveled. Do they get hired as a director of product, but get paid at the lower end of the compensation band because they’re more junior than the team was hoping for? Or do they get bumped down to a senior manager role? One way companies answer these questions is by setting up a follow-up call with another member of the team.
If this call happens at the offer stage, however, then its motivations are a bit different. Instead of figuring out whether a candidate is right for the team, these calls are all about selling candidates on why the team is the right fit for them. Here, companies are trying to learn more about candidates. What are their motivations? What projects are they really excited about? How can we craft the most compelling sell?
All of this information is then fed back to the recruiter, who uses that information to create more touchpoints during the final offer conversation.
“These are fundamentally just sell calls. They’re all about getting candidates excited,” said Stallone.
A few other possible reasons for the extra call:
- Company hiring processes aren’t always as neat as they should be. Sometimes, hiring teams just don’t get all the information they need the first time
- You have competition, and the hiring team can’t decide which candidate they like most
- Someone who is not the hiring manager has fallen in love, so now a different set of people are making the final decision
The recruiter says they’ll “get back to you” when you negotiate your offer
Every book or article about compensation says the same thing: Never accept the first offer. This is for good reason: With some exceptions, the first offer is rarely the max of a budget for a role.
Taylor at Noodle Partners said that when recruiters “check with the team,” they’re typically talking to the hiring manager and finance team to see if the new requested salary matches not just what’s realistic for the role, but also whether it’s in line with what others on the same level are getting paid.
“What surprises me is when people have more than one offer and don’t take the opportunity to ask if we can go any higher,” said Taylor. “Sometimes we can, and sometimes we can't, but you don't know if you don't ask.”
It’s worth considering the subtle psychological element here as well: Sometimes companies just to give candidates the impression that it’s hard for them to move an offer up, which might encourage candidates to take whatever counter with.
The exact nature of that flexibility, however, varies depending on how large a company is. Recruiters at small firms, for example, can in some cases go directly to their board of directors to approve non-standard compensation, such as higher points of equity. In other cases, while hiring may not have the budget for a role, VPs or heads of departments might.
“It’s critical to understand that you can’t treat companies the same with your negotiation,” said Stallone. “Knowing that helps you understand what they can offer, and what they can’t.”
Still, it’s worth considering the subtle psychological element here as well: Sometimes companies just to give candidates the impression that it’s hard for them to move an offer up, which might encourage candidates to take whatever counter with.