"Is Now a Good Time to Ask for A Raise, before The Bubble Bursts?" - 06/29/22 Edition
Stephen Says Column

Dear Stephen,

I hear it is a “candidate's market." It is hard for companies to hire enough people and just as hard to keep good people. So, does that mean it is a good time to ask for a raise? I like my job, the company, and my boss. I work hard, I don't want to move, but sometimes threatening to move is the only way to get the boss's attention and get a raise. On the other hand, I am even happy to justify a raise based on inflation and the cost of living going up so much. Life is costing me more; I need to make more money and I think my company should understand that and be paying me more.
What is your advice? Is today a good time to ask for a raise and what do I base it on?

Help Me Make More, I Feel Poor!

Dear Poor (You),
A raise is never warranted or based on your personal needs or “cost of living". Chances are, if you are writing to me on this platform, you're in sales and raises are given for sales performance not because you’re a nice guy or because you’re paying more for groceries. And whatever you do to earn a living, salary increases come from greater work output, check boxes on your annual review or some other formula. Companies pay on how good a job you are doing and what that job is worth to them. That inflation we all feel is costing your company just as much money as it is costing you. For instance, just sending someone to NeoCon this year costs a fortune. Just think about how the airline tickets, the hotel, the meals and entertainment, even the crazy increases in Uber, have affected costs.

In the big picture, when company’s costs go up and profits are eroded they raise prices until they can’t anymore, and then have to cut expenses and that’s where you come in. When companies run out of options they have to cut salaries and let people go. Quite the opposite of issuing raises!

Do you hear the word recession looming in everything you read? Historically, recession and the furniture industry have an infamous relationship – it starts later here but it last longer. Oh boy, I can’t wait (he said sarcastically). By the way, anyone who attended Neocon and Design Days can tell you how Covid has not gone away. It may not be as powerful but people are still getting it. So, all these factors affect your company’s ability to give you a raise. Here is another news flash: Yes, it has been a “candidates’ market” in many fields, and it still is right now, but as the stock market dips, and talk of recession ramps-up, employees and candidates have only a limited time left to dictate their income and future. By the end of this year, I believe, companies will be more cautious, and times-they-will-be-a-changing. So today, or sometime soon, could be the BEST time to ask for a raise or change jobs, before the bubble bursts. Just do not price yourself out of your current job, or overestimate your worth to a prospective employer for a new job.

My answer is twofold, your cost of living has little bearing on what you deserve to be paid. Ask for a raise based on your performance: document to your boss what contributions you make beyond your job description that merit an increase. Today, right now, the job market is still hot, but that will change as we get to Q4, so change jobs for that big increase now, or ask your current employer for that raise now because once we hit 2023, I believe you may open to a new scenario with raises and the job market. And I do not necessarily mean a recession because recession or not, companies will be more cautious. Business is still good, but with interest rates going up and inflation staying high something has to give and chances are employment may be next. Salaries get cut and so do jobs. Raises are frozen.

What happens to me and my business? Recruiters like us stay busy, not because companies cannot identify good people, it’s because hiring managers cannot get those good candidates to say “YES” to the job. Recruiters do great in this economy because we get the active players who control revenue to change jobs. It's because candidates feel comfortable asking us, a third party like The Viscusi Group, questions they may not want to ask the new employer directly, or the candidate may not what to share what is in the back of their mind. Aside from being a trusted resource in the industry, we are highly skilled at shifting the narrative when necessary and communicating the robustness of an opportunity. We work with the hiring company in getting the right candidate to accept the job offer. We are worth our weight in gold by befitting both our client with a productive new employee and our candidate, with an increase in compensation and an exciting new career opportunity . So, go ahead and ask for that raise with your current employer, and if you are interviewing right now ask for more money, because come the end of the year the tide may shift back to the employer. By then, some people may get a pink slip instead of a raise.

Sincerely yours,