You've been at your current gig for a while, and you're feeling that familiar itch to jump ship. You're over the monotony, the predictable routine, the same old faces day in and day out. You want a change, and you're ready to roll up your sleeves and dive into the tumultuous, nerve-wracking realm of job hunting. Well done for taking the leap!
But as you dream about the possibilities that lie ahead, there are new questions gnawing at the back of your mind: How much more should I expect to be making when you land a new role? What can I do during the job search and interview process to increase my chances of a salary bump?
It's time to find out.
What’s the average salary increase when changing jobs in 2023?
The exact answer to this question depends on a multitude of factors, such as your current industry, the profitability of your company, your level of experience and seniority, job performance, and the nature of your role. Market trends, cost of living adjustments, and company policies also play a part.
But the average range of pay increases for people switching jobs tends to hover around ~5–15%.
Salary bumps across industries
Understanding the specific dynamics of your industry is crucial in formulating a negotiation strategy when switching jobs. The percentage increase you can expect when changing jobs can vary significantly from one sector to another. Let's examine a few different industries to illustrate the diversity in potential salary bumps:
- Executive Management: For those in executive management roles, the stakes are often higher, as are the potential rewards. A C-suite executive, particularly in high-demand industries like technology or finance, could command a salary bump of 25-30% when switching companies, especially if they bring in valuable expertise and a robust network.
- Fast Food: The fast food industry, often marked by high turnover rates and low wages, may see smaller salary increases when employees switch jobs. Depending on the specific role and geographic location, in this sector, there’s an average raise percentage of around 3-5%.
- Education: In education, you might expect a moderate raise of around 5-8% when transitioning to a new role. This figure may be higher in private or international educational institutions.
- Healthcare: Given the high demand for healthcare professionals, especially nurses and doctors, job changers in this field may expect an average salary increase of 10-20%.
- Information Technology (IT): With rapid advancements and high demand for skilled professionals, those in the IT sector can expect a raise of around 15-25% when changing jobs.
- Financial Services: Professionals in banking, investment, and insurance sectors may look at an average salary increase of around 10-20%.
- Manufacturing: In the manufacturing sector, an average salary increase when changing jobs could be around 5-10%.
- Consulting: Consultants, especially in high-demand areas like strategy and digital transformation, can expect salary increases of around 15-25%.
- Retail: For retail professionals, the average raise when changing jobs is typically lower, around 3-7%.
Tips for calculating your expected salary increase
Switching jobs is the easiest way to increase your salary
Sad but true — switching jobs means you're both more likely to get a pay increase at all, and likely to get a significantly higher one, than if you stay in your current position.
The average yearly raise after 1 year of work, on average, tends to be only about 2–3% — barely enough to offset the effects of inflation in a standard year.
While some employers may be open to discussing a salary adjustment based on market conditions, others reserve significant raises for high performers asking for a merit increase. Even then, you're looking at an average 5% raise, which is still not enough to cover inflation in 2023.
Adjust for inflation
Keep in mind that in 2021, inflation rose to 6.8%, the highest in more than 30 years. And in 2022, it was 6.5%. This means that in 2023, you're going to want to aim for an increase in pay of at least 7% — less than that and you're taking an effective pay cut. If you're looking at an increase in responsibilities or seniority, make that at least 10%.
Consider the current job market
While the average range for job increases is 5-10%, that doesn’t mean you’re limited to these figures. When switching jobs, you should aim to negotiate for at least a 10-20% pay increase. Why aim high?
- You’re unlikely to get the full amount you negotiated for. A common tactic is for employers to counteroffer with a lower salary — prompting both parties to meet in the middle of the range as a compromise.
- You have the high ground. If things go south, you can always return to your current job (assuming you didn’t quit before you had your new job lined up).
- Current market trends overwhelmingly favor workers. With employment on the rise, labor statistics show that plenty of industries are in high demand, which means that prospective employees have a lot more power than they used to.
Consider your total compensation
Pay increases should be measured in terms of total compensation, including benefits, stock options, commission, and guaranteed bonuses. So, if your new company is offering higher cash compensation but a weaker benefits package than your current one, you should factor that in.
Consider your future
Your future earnings can be significantly influenced by the salary negotiations you make today. The raises you secure now don't just reflect your current worth; they set a benchmark for your future earnings and career growth. So, don't just look at the here and now. Consider the big picture and strategize for the long-term.
How to get a salary increase when changing jobs
From polishing your resume to acing the interview and honing your negotiation skills, there are plenty of things you can do to up your chances at getting a large salary increase when getting a new job.
- Tailor your resume to the job you want
- Don't disclose your current salary
- Do your research on current market rates
- Always negotiate before you accept an offer
- If you can't negotiate salary, try negotiating benefits instead
- Don't count on being able to negotiate better pay after the fact — ask for what you want now
If you’re wondering how to go about polishing your resume for a new job, upload your resume to the tool below — it’ll let you know if your resume checks all the boxes from a hiring manager’s perspective (and helps you get a higher salary!).
Be an attractive candidate
To have a fighting chance at a pay bump, you’ll need to position yourself as an impressive candidate — someone who has made a real impact for their previous employers. The moment you look like a star hire is the moment you gain significant leverage over your prospective employer — and it all starts with a well-written and tailored resume. A quick way to tailor your resume is to add skills and keywords relevant to the job, use the tool below to find the right ones.
Prove your worth and highlight performance evaluations
When asking for a pay bump, it's crucial to not only highlight your achievements but also underscore positive performance evaluations and feedback. If you've been exceeding expectations, bring this to your employer's attention! Be sure to include specific instances of positive feedback and high performance in your resume, as this could significantly increase your chances of getting a higher initial offer.
Don’t show your hand
Never disclose your current salary if you can help it. Many employers, especially the unscrupulous ones, will ask for your current salary — though luckily, this practice is being outlawed in many states.
Instead, if you’re looking for a salary bump, state the range you’re looking for in the prospective role. This is especially important if you’re being underpaid in your current one!
Also, if you can, see if the role lists a salary range upfront (though many employers don’t do this, some states are making it mandatory) — and use resources like Glassdoor and Blind — or even interview others in the industry — for more information.
Understand, however, that some salary ranges may be more flexible than others, depending on the company, hiring manager, and role. In general, if the stated range is well below what you’re looking for, don’t count on your salary offer to magically land above the high end of the range — no matter how great of a candidate you are. Sometimes, companies just don’t have the budget for it.
Gather as much intel as you can
Always do your own research before you apply to any position. Familiarize yourself with the market, and take note of the salaries typically offered for the role you’re applying for in the industry you’re in.
Dig deeper into the company as well. Find out what they usually offer for the position you’re applying for. Again, interviewing people who are already working at the company you’re looking to get into is a great way to get more information on the company and role.
In short, seek out as much information as you can get your hands on. The more you have, the more likely you are to be successful in getting a significant salary increase.
Negotiate, negotiate, negotiate
While discussing the salary, it's not just about what you ask for, but also how you ask for it. Here are some specific strategies and phrases to help you in the negotiation process:
- Don't Accept Immediately: When you receive the job offer, express your excitement and gratitude, but don't immediately accept. Instead, you might say, "Thank you so much for the offer. I am really excited about the potential opportunity to contribute to your team. Could I have a couple of days to review the offer in detail?"
- Assert Your Expectations: Once you have assessed the offer and determined that it's lower than what you were expecting, it's time to convey your thoughts. You could say, "I am very enthusiastic about the role and the chance to bring my skills and experience to your team. However, based on my research and understanding of the industry standards, I was expecting a slightly higher base salary."
- Provide a Specific Counteroffer: Instead of leaving it open-ended, provide a specific number that you have in mind. For example, "Considering the responsibilities of the role and my experience, I was hoping for a base salary of [insert amount]."
- Focus on Value and Justify Your Request: When providing a counteroffer, it's crucial to justify why you're worth that amount. Explain the unique value you bring, any relevant accomplishments, and how you plan to contribute to the company's success.
- Negotiate Benefits and Flexibility: If the company seems unable or unwilling to increase the base salary, consider negotiating other aspects of the job offer, such as flexible working hours, vacation time, or professional development opportunities.
- Stay Polite: It's vital to approach the negotiation process with respect and understanding. Employers are usually more willing to negotiate with candidates who show professionalism, confidence, and a genuine interest in the role and company.
Remember, negotiations should occur after you get the offer but before you accept it — but once you do accept an offer, it’s a done deal.
Related: Questions To Ask Recruiters
Don't rely on future promises
Finally, keep in mind that a future raise or bonus at your future employer may not pan out — and even if it does, it may not make up for a lackluster starting salary. In fact, it may be easier to get a new job than it is to get a meaningful raise — some companies have raise caps but are willing to offer new hires much higher starting salaries.
How to ask for a raise without switching jobs
Happy in your current position? If you're looking for a salary increase but don't want to have to quit your job to get one, here are some tips for asking for a raise from your current employer.
Prove your worth
The best time to ask for a pay bump is when you’ve done something significant in your current role that you can quantify or if you’re being promoted. After all, if you’re looking for a raise, you'd better be able to justify what you’ve accomplished to merit it.
Secure a counter-offer
If you're willing to go through the job search process but not ready to commit to jumping ship, you can try to get a company to give you a counter-offer based on an offer from another company.
However, like all aggressive negotiation tactics, this one can backfire, because it signals to your prospective employer that you’re less likely to be loyal and more willing to jump ship if better opportunities arise — and may make you a prime target for layoffs or other adverse situations.
When to look for a new job to increase your salary
Like many things, there’s an optimal time for job hunting. If you’re looking to maximize your salary offer, try applying toward the start of the year (especially if your current company pays out year-end bonuses or if paid time off is accrued based on days worked) or once your stock options and/or 401(k) match vests.Other opportune times to consider switching jobs include:
- When you’re currently underpaid and your current company isn’t willing to budge. (Inflation in 2021 rose to 6.8% so you want to make sure your company adjusts your salary accordingly.)
- When you’re moving to an area with a higher cost of living. (If this is the case, you should negotiate a much higher salary increase in a new role — one that’s at least commensurate with the increase in cost of living — or else, you effectively get yourself a pay cut.)
- When you've completed a noteworthy project, gained a new skill or qualification, or achieved a promotion.
- If you have in-demand skills.
- When the labor market is tight (like it is now).