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Gen Z is hitting the job market — what they need to know to get the best salary and benefits

Key Points
  • Recruiters are more willing today to negotiate salary and benefits to secure the best candidates.
  • Yet only 49% of Gen Z understand they can leverage the tight labor market to negotiate a better offer, especially in STEM fields and professional services, according to a new recruiting study by Yello.
  • Before accepting their first job offer, Gen Zers should understand the best practices to negotiate a higher salary and better benefits.
Getty Images | Hero Images

It's June, and Generation Z is about to hit the job market. Yet while these 18- to 22-year-old candidates share many things in common with preceding generations, they think about and approach employment very differently than their predecessors.

Money is important to them, but real responsibility, meaningful work and opportunities for future advancement are equally so. And with the lowest unemployment rate in 18 years and a strong economy, those looking for a new job may be able to shop among multiple offers.

According to a new recruiting study by talent acquisition platform Yello, within three months of their job search, 2 out of 3 business majors expect to receive more than one job offer; half of Gen Z computer science and engineering majors expect to receive multiple offers; for non-STEM majors, like communications or political science, 7 in 10 members of this generation are worried about finding a job; and 3 in 4 Gen Z education majors expect to receive at least one offer.

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In February 2019 Yello partnered with SurveyMonkey Audience, SurveyMonkey's global market research panel, to survey 750 full-time employees and students ages 18 to 54 to compare and contrast the evolving array of needs and behaviors between each generation. What they found was that Gen Z is the least likely generation to negotiate a higher salary or better benefits, even though competition for talent today is so intense.

That's because these first-time employees aren't sure what to expect when it comes time for salary negotiations, says Jason Weingarten, Yello's co-founder and CEO.

Source: Yello

The study revealed that while most recruiters agree that in the current employment market the balance of power has now shifted dramatically from the employer to the talent, only 49% of Gen Zers, compared to 70% of millennials, plan to leverage the tight labor market as a way to negotiate a higher salary and better benefits.

"Even more surprising, says Weingarten, "a quarter of Generation Z expect to earn less than $30,000. This suggests that students aren't aware of the opportunities available to them, especially in STEM fields and professional services. Without an understanding of the job market and in-demand roles, students don't know what to expect."

The worst thing you can do when negotiating a salary is to appear as though you deserve the additional compensation without giving clear reasons why.
Jason Weingarten
Yello co-founder and CEO

Weingarten points to a number of reasons these younger candidates don't think to negotiate, namely the gig economy and sites like Glassdoor. "Gen Z is wary of student debt, so many of them have participated in the gig economy, where there's little negotiation because the price of the gig is set in advance. When Gen Z is hired after graduation at a large company, the salary ranges are widely known through Glassdoor and other sites. These large companies make a much greater effort to ensure equal pay for equal work, so there's really not much to negotiate."

Nevertheless, Weingarten believes that these candidates should negotiate and that recruiters expect that they will, especially if prospective candidates don't think the compensation offered is fair. He does warn, however, that it must be done the right way: "The worst thing you can do when negotiating a salary is to appear as though you deserve the additional compensation without giving clear reasons why. Be calm and collected at all times, and be prepared with market data to show that you are below market rates."

Weingarten offers the following tips to achieve the best outcome.

Steps toward a successful salary negotiation

Do your research. Before receiving an offer, be sure you fully understand your worth to the prospective company. Do research to determine your salary range based on location, industry and market.

Be enthusiastic and honest about your interest. When you receive an offer, reiterate your enthusiasm and make it known that you are seriously considering it (assuming you are). If the salary is lower than expected or research determines that your role is worth more, feel confident to negotiate. Ask a question like, "Do you have any flexibility on salary?"

Practice, then practice again. Have a plan to negotiate ahead of time and practice making a case. Remain professional and calm, and point to your research on similar positions, as well as your experience: internships, leadership in student organizations, coursework and a competitive GPA.

Come up with an exact figure at the high end of the salary range. Your employer will almost always counteroffer with a lower figure, so it's important to start with a number at the top of the range so ou come to a middle ground that you are happy with. Asking for an exact figure, say $57,350 indicates to your employer that you have done your research thoroughly.

Compile a list of needs. Carefully make an outline of the things that such as scheduled time off or remote work, and present these needs with your counteroffer. Avoid making last-minute requests after receiving a revised offer.

Be reasonable — and mindful. Understand that a successful negotiation does not mean receiving everything you want. Accept the offer as soon as you are comfortable, and reach out to other companies to remove yourself from consideration.

Check out I made $1,000 by taking pictures with this easy side hustle via Grow with Acorns+CNBC.

Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.

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Megan Rogers