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5 Signs You’re Underpaid

Topics: Career Advice
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Do you feel like you’re underpaid? If so, you’re in good company. Only 21 percent of employees feel they’re being paid fairly, according to data gathered for PayScale’s Compensation Best Practices Report.

Of course, not everyone who feels like they’re underpaid is earning less than market rate. There are many factors involved in your perception of how your pay stacks up.

For instance, you might have a manager who doesn’t communicate well about your employer’s compensation philosophy, leaving you in the dark about how your salary compares to that of others with your job title. Or, you might be going by hearsay, without considering whether your coworkers have additional experience and certifications that explain why they’re earning more — assuming, of course, that they’re even telling you the whole truth.

Obviously, you should be paid fairly. Beyond needing to meet your expenses, you want to feel respected by your employer. Further, resentment doesn’t exactly inspire productivity. Sit around stewing about your low salary for long, and you might find yourself trapped in a cycle of self-reinforcing underpayment.

Do You Know What You're Worth?

But first things first: are you really underpaid? Here’s how to find out.

1. Your Research Shows That You’re Underpaid

And by research, we don’t mean asking around. You need accurate data if you’re going to compare your salary to that of other workers in your field.

PayScale’s Salary Survey walks you through a series of questions designed to determine how much you should really be earning, based on your skills and experience. In less than 10 minutes, you can get a free salary report that shows how your pay stacks up against thousands of people in your area with your job title and qualifications.

That’s a lot more reliable than asking a few friends for the dollar amount on their paycheck.

[click_to_tweet tweet=”Do you feel like you’re underpaid? If so, you’re in good company. Only 21 percent of employees feel they’re being paid fairly.” quote=”Do you feel like you’re underpaid? If so, you’re in good company. Only 21 percent of employees feel they’re being paid fairly.”]

2. You Don’t Negotiate Your Starting Salary

In a recent CareerBuilder survey, over half of employers said that when they offer a prospective employee a new job, they offer a lower salary than they’re willing to pay. Why? Because they assume you’ll negotiate.

In other words, if you don’t negotiate your starting salary, you’re leaving money on the table — a lot of money. Don’t forget that most employers calculate raises as a percentage of your current pay. So, if you take less now, you’ll miss out on bigger raises over time. Over the course of your career, that could add up to as much as $1 million in missed earnings.

Need help planning your negotiation strategy? Read PayScale’s Salary Negotiation Guide.

3. You’ve Been at the Same Job for a While

Raises at many organizations average about 3 percent a year — nice to have, but not very impressive once you take into account inflation and rising personal expenses. To get a much larger increase, you may have to change jobs.

This doesn’t mean that job hopping will automatically lead to higher earnings in the long run. A lot depends on what you do for a living. PayScale’s research shows that software developers who stick around at the same employer for nine or 10 years earn 10 percent less than new hires. On the other hand, administrative assistants who have a decade of tenure at the same company earn 19 percent more than newbies with similar work experience.

But, if you’re in a hot job — meaning, one where employers are competing for top talent and have to pay to get it — sticking around will often cost you. So if you’re looking at a 3 percent raise this year, and you’ve been with the organization for a while, you might want to consider whether it’s time to look elsewhere.

4. Recruiters Offer Higher Paying Jobs

“You are underpaid if recruiters regularly contact you to tell you about other local jobs with similar responsibilities that pay several thousand dollars more than you’re earning now,” writes Liz Ryan at Forbes.

However, she adds: “You are not underpaid if recruiters call you about other jobs but those other jobs pay just what you’re earning now or offer fewer benefits, worse hours or some other downside you don’t currently experience.”

5. Niche Job Boards List Similar Jobs at a Higher Range

For the most part, American employers are reluctant to list salary ranges in their listings on job boards or on the careers page of their corporate sites. But there is an exception: if you’re using niche sites, you may find that some companies are more forthcoming.

“It can be difficult to gather accurate data on catchall job boards like and Craigslist (most postings state the ever-elusive ‘depends on experience’), but if you use sites specific to your industry, you’ll get a better idea of the opportunities that are out there,” writes Lauren Hargrave at The Muse.

This is useful even if you’re not looking for a job right this very second. While you have no way of knowing where you’d fall in the range, a glance at industry-specific job sites may give you a sense of whether your pay is entirely outside the range. And while you’re looking, you might just find something that inspires you to dust off your resume.

Tell Us What You Think

Have you recently discovered that you’re underpaid? We want to hear from you. Share your story in the comments or join the conversation on Twitter.

Jen Hubley Luckwaldt
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