One thing I hear all the time when I'm calling prospective job candidates is 'my friend over at so and so company makes more than me doing the same thing!'. If all of your peers are making more money than you, then you are not being paid your market value.
- It's not as taboo to talk money. My friends openly talk about money and strategy in ways my parents' generation never did. Some companies try to stop this with policies to punish employees who share their salary, but you can easily find a salary range with sites like Glassdoor. If you're embarrassed to talk about money think about why that is. Do you wish you were making more? Are you afraid your friends will be jealous? I'm not saying go around bragging and being obnoxious, but don't be so secretive and you'll learn more as well.
- Don't compare apples to oranges. If your friends have responsibilities you don't then that could explain why they make more. Do they have to manage other employees? Do you have non-salary benefits they don't such as flexible schedules, working from home, stock options, etc.? People don't always talk about the less glamorous side to their jobs so maybe there's a reason they get paid more.
- Have you been at the same company too long? If your company only gives a 3% cost of living increase every year, it's almost certain your pay will not keep up with the market. If you work in a technical area, the cost of your skills may be rising at 10% each year. Switching companies generally gives you a 10-15% increase in salary, so if your company is not paying you your value, consider other options.
- It's in the company's best interest to pay your value. They might think they're getting a great discount by keeping employees under market value, until the cost of replacing and training new employees is factored in. What about lost sales or lost clients? Employees that know they're underpaid will lose their willpower to give it their all.
- Don't assume time or education have value. Focus on your output and what you offer your employer and not on things like how long you've been there to determine your value. Just because you took night classes to get your masters doesn't mean your employer gets any added value, so this alone should not be a reason for a pay increase.
Once you have a good grasp on your true value, approach your company with the evidence. Explain why you're worth more and what you do for them. If you've taken on more responsibility with no or little increase in compensation this is the time (better late than never) to bring it up. Don't approach this with a whiny attitude, but rather a business mindset. Don't threaten to leave or make any rash decisions if they don't agree. If negotiating doesn't work, then contact me at Zach@stratussearch.com and I'll help you determine your market value and a company that will pay you what you're worth.