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5 Signs You’re Underpaid

Topics: Negotiation
salary history
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Everyone could use more money, but how can you tell when you’re really underpaid?

The answer isn’t to poll your coworkers or friends and compare your salary against theirs. For starters, you can’t be sure that everyone you talk to will be 100 percent truthful. Also, it’s impossible to know whether you’re comparing apples to apples — they might have certifications you don’t know about, or job experience that bumps them into the next pay bracket.

But of course, you also don’t want to just sit around hoping for the best, while your salary stagnates. To find out if you’re really underpaid, watch out for these signs that you’re overdue for a raise.

1. The PayScale Salary Survey shows that you’re underpaid.

The single best way to determine if you’re being paid appropriately for your work is to compare your pay to vetted market data. Take PayScale’s Salary Survey, and get a free report with a salary range based on your job title, experience, education, skills and location. Because our survey results are based on hundreds of thousands of user responses, the results are a lot more reliable than just asking around. (Also, it’s a lot faster — a few minutes versus hours of listening to your cubicle mate brag about his raise.)

Do You Know What You're Worth?

2. You got caught in the salary history trap.

Hiring managers love to ask candidates for their salary history. That’s a shame, because your past pay should have no bearing on your next job offer.

That’s not to say that you’ll always be able to get out of giving your salary history. PayScale’s report, Is Asking for Salary History … History?, shows that women who refuse to answer the salary history question actually earn less than those who disclose it when asked. (Although the opposite is true for men.)

But regardless of whether you’re forced to fess up or not, the fact is that your salary should be based on the role under consideration, not what you made at your last job. If you must answer, try to reframe the question so that you’re focusing on this job.

3. You didn’t negotiate your starting salary.

Research compiled for PayScale’s Salary Negotiation Guide shows that 57 percent of workers have never asked for a raise in their current field. A whole lot of people out there are taking what they’re given, no questions asked.

That’s understandable — salary negotiation can feel confrontational, especially if you’ve never done it before. But if you don’t negotiate a new job offer, you’re almost certainly leaving money on the table.

“Rarely will recruiters make their best offer as their first offer,” Lee E. Miller, author of Get More Money on Your Next Job, tells Monster. “They expect job candidates to negotiate.” And remember: You can negotiate salary, benefits, a signing bonus, equity or a flexible schedule.

4. You’ve been at the same job for years, and have never received a raise.

Real wages are 7.4 percent lower than they were in 2006, due to the fact that the price of goods has risen faster than incomes. As a result, if your salary has held steady for the past few years, you’re actually earning less than you were.

If your company is making money, and you’re exceeding your goals, but your pay hasn’t increased, it’s time to sit down with your manager and ask for a raise.

5. You’re underemployed.

When surveyed for a PayScale report, 46 percent of respondents said that they were underemployed. What does this mean? Either that they were working part-time when they wanted to be working full-time, or that they were working at a job that didn’t use their education and skills.

“If you know that you’re capable of performing a higher-level job than the job you have, don’t panic — most of us have been there!” writes Liz Ryan at Forbes. “Keep your survival job and back up and think about what you want to do next. You may need to rebrand yourself for the jobs you want. If you can show how you’ve solved bigger problems and had greater impact than you do your current role, you can get a job interview and move up to a higher-level job.”

Ryan suggests consulting, to build your confidence and remind yourself of your talents. Doing so could help you develop skills while creating a brand that will get you hired by an employer who’s willing to pay appropriately for your talents.

Tell Us What You Think

Have you ever been underpaid? We want to hear from you. Tell us your story in the comments or join the conversation on Twitter.

Jen Hubley Luckwaldt
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