Study Reveals the Secrets to Negotiating a Higher Salary

Posted: October 20, 2010 at 1:00 am, Last Updated: November 3, 2010 at 8:12 am

By Dave Andrews

Michelle Marks

A recent study conducted by George Mason University and Temple University researchers uncovered the most effective strategies to negotiating a higher salary. The study analyzed various approaches to the negotiation process, which methods were the most successful and which ones were more likely to leave both parties satisfied with the outcome.

Michelle Marks, associate professor in Mason’s School of Management, and Crystal Harold, assistant professor at Temple University’s Fox School of Business, wrote the study.

A sample of newly hired employees in various industry settings participated in the study, which showed that those who chose to negotiate increased their starting salaries by an average of $5,000.

“In today’s economic climate, raising your annual salary is highly uncertain,” Marks says. “However, our study results highlight the significance of effective salary negotiation and why it’s important to be upfront with the issues, enabling both parties to consider creative ways to find win-win solutions.”

According to the study, which will soon be published in the Journal of Organizational Behavior, the compounding effect of successful salary negotiation can be significant. Assuming an average annual pay increase of 5 percent, an employee whose starting annual salary was $55,000 rather than $50,000 would earn more than an additional $600,000 over the course of a 40-year career.

Five negotiation strategies were examined in the study: accommodating, avoiding, collaborating, competing and compromising. Individuals who negotiated using the collaborating and competing strategies —openly discussing issues and perspectives — had the best results. In contrast, those who used the avoiding, accommodating and compromising approaches were less successful in negotiating higher salaries.

But there are some drawbacks to using the competing strategy, Marks warns. “While more aggressive negotiation strategies succeeded in raising one’s starting salaries, people who used them felt less satisfied with their outcome than did those who used more collaborative approaches,” Marks says. “Those who were overly accommodating ended up feeling the least satisfied and that the process was unfair.”

The study found that men and women were equally likely to negotiate, but that women were less effective at raising their salaries when compared to men. They were no more inclined to use a particular strategy than men.

“We were surprised to find no differences with respect to how men and women negotiated,” Harold says.

“Previous research tended to focus on gender differences and the negotiated outcome, assuming that women approached negotiations differently than men and that men were more competitive. Our study found that, although job seekers approach negotiation differently, negotiation strategy was unrelated to gender.”

Non-salary gains, such as vacation time and perks, were also analyzed. More than half of the people polled who chose to negotiate received at least one additional non-salary gain.

Write to mediarel at gazette@gmu.edu