Some people think that this question aims to screw you and see how much they can squeeze out of you (especially if it comes from a recruiter, not from a headhunter). But having this belief won’t help you much. It’s better to think that they are looking for a win-win relationship, and they want to pay you fairly (if they see you a top performer) and avoid discrimination allegations. They ask you this question just to verify that you are NOT above their normal range. No company likes to hire someone that accepts to be offered a salary that’s below their expectations because that person will not be naturally motivated.
Usually the hiring manager has a salary range in his mind, and you will fall into it depending on three factors:
1) your current salary
2) how your experience relate to the job
3) the internal equity, meaning how the company is paying others in similar roles.
They ask you about your expectations because they want to figure out where in their range you would best fit, so they don’t over pay and you don’t get undervalued. And they appreciate people who know what they want.
So, the best advice here is to do your research: research what the company is paying, be confident in your skills and know your market value as I teach in the Phone Interview Success System. And then be direct and sincere and tell the salary range where you’d feel comfortable with. So, if you’re making 50k for instance, say you’re looking in the 60-70k range but you’re flexible and ask if that is within the range of what they expect to hire at. In case you are not in range, show them that you enjoy the work more than money, and that money expectation should not be the deciding issue.
Or you may want to negotiate when you hear this question (especially if you work at senior levels)…
It is hard to negotiate when you’ve been in the job market for months and low on savings. It is especially hard to negotiate in recession times, when the employers are the kings and the employees are the servants more than ever. However, if you want to play that game, you must be ready to let go of this job opportunity. You must be able to stick to your guns and be able to walk away. You need to really be able to say, ‘no thank you, I can’t accept at this amount of money, but I will if you can come to xxx.’
In case you want to negotiate, never give the number at the first time they ask you this question, or you’ll lose your negotiation power and appear weak in the eyes of the interviewer. Resist at least once before you answer this question. Answer that you’d like to first understand what are the job requirements and responsibilities are, and get a better idea of what the range for that position is.
Remember that most recruiters are better negotiators than you. So they may use smart ways to get you to give them a salary range first. But you’ve got to be clear on this question and never give in the first time.
Another version of this question is ”What did you make at your last job?”. Again: don’t tell them first. Try to get them answer it first. Put a smile on your face and tell them something like “This job is not exactly the same as my last one. So let’s discuss what my responsibilities would be here…”
Even if the interviewer asks you ”Why don’t you want to give your salary range?”. Again: smile and be direct and confident in your answer: ”I would expect to be paid commensurately with my contribution to your company. I think you have a good idea of what this position is worth to your company, and that’s important information for me to know.” Or in case you never want to give that information, just say that “my previous employer has insisted that salary information remains confidential”. But if the interviewer insists, I’d suggest you give him a clear and honest answer (warning: many employers will check references and confirm your salary history). You don’t want to play games here unless you are a superstar. If you never give in and provide the interviewer with the information he needs, he may decide you sound like a troublesome person (or look like an arrogant prick)…
Another strategy is that you ask first: “Now that I understand about the job responsibilities, can you give me an idea of the range budgeted for this position (including all company’s benefit package)?” If they fight back with a question like “you tell me first your expectations”…smile back and said: “I asked you first (big smile) because for me it’s really important to know what this position worth to your company is. My salary requirements are only one part of the total benefit package. I prefer a job with significant upside based on performance but I am flexible and would be willing to consider a higher base salary if the bonus is lower. What structure do you use here?”.
If you’ve delayed the answer too much, you’ll see that in the interviewer’s face. Or be ready to hear something like “How strange, no else has ever had any problems telling their salary…OK……”. If that happens, you’ve got two options:
a) you give in an say what you expect (give a range) if that position really interests you and add: “but I’m flexible, based on other benefits or performance incentives” or
b) if that position is not very interesting to you, you stand on your feet and reply with “I am sorry to disappoint you but I am not sure what can I expect without discussing first about the structure you use in this company”…or you bump up your current salary by a nice 20% to 30%.
Remember my first advice: research what the company is paying, be confident in your skills and know your market value. And then be direct and sincere and tell the salary range where you’d feel comfortable with. It’s not very smart to negotiate when you are not a superstar (especially in a market where there is less job offerings than candidates).