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Gemini846 (35.54)

Temp to Perm? Be Ready to Haggle



May 19, 2009 – Comments (2) | RELATED TICKERS: JOB

I read an interesting article this morning talking about negotiating a higher starting salary.

The article talked about how employers are more than willing to make lowball offers hoping that the sour market will hold new hires in submission for a while. Personally I think the strategy backfires when the employees find out how little they are being paid compared to their peers, but more and more employers are willing to take the risk considering the debt ridden population of college graduates that are churned out each year.

A few weeks back I read that this market will pin down college grads and that many are going back to school since the entry level salaries are so low.  I compared this experience with my own recent salary re-negotiations and realized that during my initial hire I had been exempt from the opportunity for much of this banter (possibly to my peril).

I was hired Temp to Perm. The Temp to Perm arrangement seems like a boon for the employer and employee. If you hate the job you can always leave, but I'm convinced now that employers use this as a salary trap just as much as an opportunity to evaluate you. With the temp agency you don't really negotiate your own salary. Most Temp jobs (depending on the market area) pay $12-15/ hr with the agency snagging $3-4 on top of that for their own purposes. The agency's whole goal is to sell you on the cheap to get you in the door which ends up being counterproductive when the company goes to hire you.

Just like its hard to overcome a low initial salary (since most increases are based on percentages) it is hard to overcome a perception of what you will work for since you have been doing the job  cheaper than you would normally do it for. Naturally if you like the business and the people you work with its harder to ask for more money, but I propose that you must. You need to convince the employer that going back to the temp agency is a crap shoot and that you're worth what you're asking.

Of course you could always start a business, but if you're like most people you need to get some working capital on line before you venture out.

2 Comments – Post Your Own

#1) On May 19, 2009 at 10:48 AM, russiangambit (29.06) wrote:

You can always find another job. Normally, I won't take another job unless it offers 10% pay increase, it is just not worth the hassle otherwise.

Staying in the same place in the beggning of your career seems to be detimental to your future earnings potential, because companies only increase salaries 2-3% on average and not every year, so you are falling behind inflation . I think first 10-15 years of your career you should change your job every 3 years or so  until you find a company you want to work for long term and progress through management ranks. By changing jobs you build up your resume, broaden your experience and you get ahead on the pay scale.

As for holding the salary down this being a bad strategy for the companies. Of course, it is. But they don't plan any further than the next earnings release. So, it is hopeless to expect that at some point they will realize the error of their ways.

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#2) On May 20, 2009 at 8:54 AM, Gemini846 (35.54) wrote:

Here is the link to the article regarding how the class of '09 is getting screwed on the wage line.


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