Lately, your paycheck has been evaporating faster than ever. You’re not spending extravagantly or splurging on luxury goods. In fact, you’re probably buying the exact same things you were this time last year. The problem is that record-setting inflation has pumped up prices on gasoline, staple foods, appliances, and a range of consumer goods. As costs rise, your salary stubbornly stays the same. And a steady paycheck in a time of steadily increasing prices is seeming like a raw deal.
You’re desperate for a cola. Not the caffeinated drink but a cost of living adjustment, AKA COLA. COLAs inflation-proof income by chaining it to the Bureau of Labor Statistics’ Consumer Price Index or other metrics determining the value of dollars. Your job doesn’t offer cost of living increases, but with your take home pay badly in need of a boost, you’re ready to ask for one.
Of course, asking for a raise of any kind is easier said than done. Americans are conditioned to believe talking about money is impolite, which makes asking for more money positively excruciating. So how do you ease the pain of the ask?
“People definitely feel awkward about it and this comes up a lot,” says areer coach Allison Task “You’re in a quite weak position and most importantly, you don’t want them to think you’re greedy or a bad employee. You might fear how you will change in their eyes just by posing the question.”
First, some bad news. Asking for a cost of living adjustment is a bad idea. They don’t work that way. Cost of living adjustments aren’t something individual employees ask for. Employers offer them automatically, as a matter of policy, for all employees, or they don’t offer them at all. They’re often the result of union negotiations and are more common for public employees. Declining union power and decreasing inflation have made COLAs rare outside of Social Security benefits. Some companies have reacted to the rise of remote work by offering location-based pay but that’s not going to mean a salary bump unless you moved from West Virginia to Brooklyn.
As Darcy Eikenberg, career coach and author of the book Red Cape Rescue: Save Your Career Without Leaving Your Job, notes, COLAs don’t happen on a one-on-one basis. And because they’re a matter of policy, bosses can easily decline requests for them by saying it’s against policy and therefore out of their hands. “If you’re only asking for a cost of living increase without combining it with an increase based on performance, you’re likely to get turned down or to get a ‘we have to wait for corporate’ answer,” Eikenberg says.
A tale of woe won’t get you the salary bump you need. Unless you work at a post office, COLAs probably don’t kick in automatically. You could unionize your workplace and fight for a contract with cost of living pay increases. But at best, that would take months or even years. And you need more money now.
All is not lost. The good news is about to kick in. You can get the salary bump you need. The conditions are in your favor at the moment, as economists say it’s a great time to ask for a raise. But arguing that you should get more money because you need more money isn’t effective. However, asking for more money because you deserve more money is.
“I would highly recommend people ask for a performance increase rather than a cost of living increase,” says Abby Kohut, owner of recruiting firm Staffing Symphony..
Under normal circumstances, employers have the advantage during salary and bonus negotiations. But currently, employees have greater leverage than usual, thanks to the “Great Resignation.” The pandemic inspired American workers to be more willing to quit jobs. As a result, employers are eager to fill vacancies and retain current employees. “It’s an employee’s market,” Task says. “There’s power with the employees right now.”
The Great Resignation gives workers good cards to play but you need to play them wisely. It’s good to be confident but don’t be cocky. Telling your boss it would be easy to find work elsewhere makes you look like you don’t want your job.
“You don’t wanna roll in thirsty or desperate,” Task says. “You don’t want to roll in arrogant. You want to roll in as someone who really loves the organization and very much wants to stay at the organization and has a vision for continued contributions.”
Task says that smart managers advocate for good employees. Make raising your salary or doling out a spot bonus an easy decision for your manager. Lead with statements that demonstrate how you add value to the organization now and your plans to increase the organization’s value in the future.
“You can say ‘I’m really proud that I was able to work on these teams that do these things. Here’s some things I’m planning to do moving forward,’” Task says.
Task stresses that research is your most valuable weapon in a salary negotiation. Walk into the conversation armed with information about salaries in your industry and your field. You might discover that you’re already making the maximum someone in your position can expect. In which case, don’t ask for a raise: ask for a promotion.
And if you exhaust all of these options, remember that you still have other options.
“If you’re in an organization where after 18 to 24 months, there’s no new opportunity for you, you’re at a stagnant organization and you might wanna consider leaving,” Task says.
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