However, wage growth is up from its trough of just 1.4% during the pandemic. And don’t forget that these big numbers include all workers, including those who didn’t get any raises. For those who asked for and got a raise, the payouts were much higher.
“The report detail clearly shows momentum is building,” Westpac economists Elliot Clarke and Ryan Wells observed in a research note to clients.
“Most importantly, private sector respondents who received a pay rise in the quarter reported a 3.8% gain, the highest result since June 2012.”
Westpac economists expect annual wage growth to accelerate to 4.5% by the end of 2023. With unemployment at a 48-year low, it’s time you got some of this action.
So here are my top tips for asking your employer the big question.
1. Don’t surprise your boss
There’s a tendency for employees who haven’t had a raise in a while to feel great resentment.
Accept that you are partly responsible for not having the courage to raise the issue. Now write a polite email to your boss asking for a time slot in his schedule specifically to discuss your salary and performance.
2. Don’t complain about the cost of living
It’s true that prices are going up and if you don’t get a pay rise to compensate, you do get a real pay cut. But it’s true for everyone. It’s not a great argument as to why youin particular, should benefit from a considerable salary increase compared to other colleagues.
3. Do your research
Before asking for a meeting, research alternative jobs and salaries. Go online or talk to recruiters.
Quietly survey your networks. Ask your friends and colleagues what they are paid. Most people are sensitive to this initially, but I find that if you offer your own salary they are more likely to be open.
Just be careful, because some companies still have draconian “salary secrecy” clauses to prevent you from revealing your salary.
4. Don’t bring a knife to a shootout
Your boss will probably ask you why you deserve a raise. Right answer.
Whenever possible, use statistics to back up your claim. Write a confidently worded one-page summary of all the ways you act above your initial job description and evidence of how you add value to the company.
If you get confused during your meeting, you can either postpone it or email it afterwards.
5. Be ready to walk
Be prepared that your employer may simply say “no”. If they do, ask for another review in three months and ask for specific information your employer wants to see before granting you a salary progression.
However, some employers may still refuse. In this case, you must be prepared to accept a better offer.
The good news is that in today’s job market, you’re more likely to find another job than at any time since the 1970s.
If you find a better deal, take it.
- The advice given in this article is of a general nature and is not intended to influence readers’ decisions regarding investments or financial products. They should always seek professional advice that takes their personal circumstances into account before making financial decisions.