What Is Your Work Worth?

I’ve been around the block a few times as it comes to employment and figuring out my work’s value.

In figuring that worth out, a few excellent tools have made themselves invaluable time and time again.

I don’t use these tools until I have an interview lined up or a change in job title or I’ve been employed at the same place for 9 to 12 months. However, when used appropriately, they’ve put the leverage on my side when negotiating a salary or raise. For the cost of an hour looking up values, I’ve netted tens-of-thousands of dollars in value added.

That, and the tools have let me know if I’m walking into a proposal as being underpaid – as an advocate for the worker, never be underpaid 😐

Here, I’m opening-up my personal toolbox for your use. May it be a starting point on your next job offer, a stepping stone to ask for a raise, or merely another reference for your own methods to calculating your work’s worth 🙃

TLDR

(Really, you should read on. But, if pressed for attention, do the following.)

  1. Get the job title for the new job / your current job.
  2. Next, get the city for the job’s cost of living (CoL; google “cost of living theCityName“).
  3. Go to the Bureau of Labor Statistics, searching for the job title, and recording the median salary.
    1. Example for Software Developers.
  4. If the median salary is not in your current year, search “inflation calculator”, using what you find to turn the salary into your current year’s dollars.
  5. Multiply the median salary by the CoL percentage (111% CoL = 1.11).
  6. Take the multiplied result, round up to the nearest tens-of-thousands (this is the Minimum Salary you should consider for the job).
  7. Multiply the result again by either 110% (this is the Expected Salary you should quote to anyone who asks).
    1. If your Minimum Salary is less than $100,000 and you’re feeling fierce, multiply the Minimum by 125% instead of 110%.
  8. Aim for the Expected Salary or more (negotiate!). Accept nothing less than the Minimum Salary.

If you want more detail, you’ll have to read on 😁

Variables

So what’s important in determining worth? Well, simply put… everything.

That’s hardly helpful, so here are some base values needed for the figuring:

  • Job Title (Title)
  • Company
  • City
  • Base Salary (Salary)
  • Potential Bonuses (Bonus)
    • Performance Awards
    • Signing Bonus
    • Stock Discounts
    • 401K Matches
    • PTO
    • Gym Memberships
    • Commute
    • etc. (Don’t worry too much on this.)
  • Cost of Living (CoL)

Titles can be important, and bonuses lucrative, but unless you have some special arrangement to fully leverage non-salaried bonuses like stocks or commission, nothing will be cash in the bank at the end of the day.

If the salary can’t be increased, multiply the difference of what you want vs. what is offered by 2 (“2” for the number of years a person typically works in a position). Negotiate for bonuses equivalent to that number.

Sites for Values

To get values for the variables, Sperling’s Best Places, the Bureau of Labor Statistics, Glassdoor, Salary, Salary Expert, and the job post itself will be your best friends.

(If any of the salary sites have bonuses, record those too).

  • Sperling’s Best Places
  • BLS
    • Search for the job title for the median salary and national area data.
      • Example of a Software Developer. (The “State and Area Data” tab has county information that gives you another salary value when you hover the mouse over the maps.)
    • If the salary medians are from a past year, use Google to find an inflation calculator to turn those old salaries into today’s dollars.
  • Glassdoor
    • Search both the job title salary globally and the company itself for salary information for similar work.
  • Salary
    • Enter some basic information to get the job’s salary.
  • Salary Expert
    • Get more salaries for the job title at the location of the job.
  • The Job
    •  Here is where you get the job title, company name, and city.

If your industry has compensation reports (eg Software and Stack Overflow, Video Games and the GDC Game Developers Survey), include those here too! More data, more power!

Formulas Go Brrrr

You’ve been good so far. Now, do this:

  1. Get one salary out of the reported salaries.
    1. If there’s a national salary (eg BLS, Glassdoor), multiply that salary by the CoL of the city the job is in to get the salary to use.
      1. Eg $100,000 national salary * 1.10% CoL = $110,000
    2. Calculate the Median and the Average for all salaries collected from every source.
      1. Google Sheets is a great tool for this.
    3. Whichever of the calculated Median and Average is higher, keep that and discard the other.
    4. Do this for the bonuses too.
  2. Round the calculated salary up to the nearest tens-of-thousands place. This is your Minimum Salary.
  3. Round the bonus up to the highest place (eg $102=$200, $1799=$2000, etc).
  4. Multiply the Minimum Salary by 110% to 125%. This is your Expected Salary.
    1. Why “110% to 125%”? Well, it depends. The higher the percentage, the more difficult it gets to defend during negotiations asking for the Expected Salary. Use judgement and self confidence in this – regardless of what gets asked for, a salary will always need defending, so preparing a longer argument of why the salary is warranted comes with negotiating 🙂

Tada! You now have a Minimum Salary, an Expected Salary, and Bonus values, aka your work’s worth. That said, let’s put them to work 😎

Using Your Worth

Here’s where the negotiation comes in. Negotiation is a topic unto itself and is better covered by cleverer folks than I, so I’ll leave you with these bullet points to keep in mind:

  1. Ask for more than you think you’ll get. That’s why asking for Expected Salary is the least you can do for yourself if pressed to give an expected value.
  2. If given an offer more than the Expected Salary and the Expected Salary hasn’t been told to the person making the offer, counter with at least the offer’s salary and the Bonus calculated earlier, if not asking for an increase in the offer’s salary by 10%.
  3. If given an offer less than the Expected Salary, work with the offer to see about raising the salary to the Expected (*cough* negotiate *cough*). Should the offer salary not be raised, do mental math to calculate twice the difference of the offer and the Expected Salary – negotiate for that value in Bonuses (signing bonus, PTO, etc.).
  4. Don’t accept less than the Minimum Salary. The greatest power is to the person who’ll walk away first.
    1. That, and accepting less than what’s literally fair (the median and average) hurts you, your peers, your industry, and your country. Don’t do it.

These values you’ve calculated are the bare minimum acceptable to not hurt yourself (Minimum Salary) and a reasonable request for the work to be done (Expected Salary) with wiggle-room (Bonus).

Remember, you are asking for compensation for the work to be done first, your history and experience second. Be aggressively fair for future, but only use the past as a lens instead of an anchor keeping you from accepting reasonable work.

Further Learning

What do you think? What do you use in your own work worth calculations? I’d really like to know!

If you’d like a spreadsheet with some of these formulas filled out, let me know.

Lastly, a reminder about our relationship to work and money:

Your pay is not a judgement on your value. It should only be a fair estimation of your work’s worth.

Good luck, y’all, on your next negotiation, job or raise. Cheers ~

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