This was adapted from CNBC's Work It newsletter on LinkedIn about all things work — from how to land the job to how to succeed in your career. (Click here to subscribe.)
With inflation soaring — egg prices have been so high, you might consider them a luxury item — increasing income has become a top priority for many Americans.
Nearly half of workers (47.7%) said their top goal for 2023 was to get a promotion or raise, while 32.1% said it was to get a new, higher-paying job, according to a survey by human resources software company Workhuman.
When it comes to raises, there's good news and bad news.
The good news is that despite all the layoffs you've been hearing about, companies plan to be more generous with their raises this year: 64% of employers said they're boosting their annual raises this year, up 23% from 2022, according to a Salary.com survey of HR professionals.
The bad news is they're not matching those raises to inflation.
Companies are planning to offer an average raise of 4% this year (that includes general increases, merit increases, and equity/market adjustments), and, while inflation has cooled from its mid-2022 highs, the latest inflation report showed consumer prices are still up 6.4% from a year ago.
Some employees are expected to fare better than others: Lower-wage workers are expected to see a little bit bigger bump than their higher-paid colleagues, because they are the ones most likely to quit for a higher-paid job elsewhere, Garry Straker, Salary.com's vice president of compensation consulting, told CNBC Make It.
So, what can we do? Giving up eggs doesn't seem like the answer. I like cheesy omelets way too much for that.
The best way to ensure a higher salary: Change jobs
Career experts say the best way to raise your salary — and get a bump that could match or beat inflation — is to change jobs.
"Job switching is one of the best ways to get a raise," Nick Bunker, economic research director at Indeed, told CNBC. "People are quitting their jobs because it pays to quit their job."
The Federal Reserve tracks wage growth and job switchers almost always come out on top compared to employees who stay. In January, for example, those who stayed got an average raise of 5.4%, while those who switched scored an average salary increase of 7.3%.
Career planning site Zippia estimates that gap to be even bigger: The average salary bump for job changers is 14.8%, their analysis shows, versus wage growth of 5.8% for those who remain.
If you do opt to change jobs, just remember that when you leave you are giving up your seniority. Of course, there's never a guarantee that you'll keep your job no matter how long you've been with a company, but employers are more likely to let people go who have only been there a short time. You know the old adage — last in, first out.
If you like your job but not your pay, it might still make sense to apply for external opportunities: If you get an offer for more money, you can always take that offer to your boss and say — "Hey, can you match it?"
Having the salary talk with your boss
Of course, there is no guarantee that your boss can or will match that pay bump — especially given the current economic climate. Companies are grappling with inflation just like the rest of us. So, you have to be prepared to get turned down.
But let's think positive for a minute. Your best shot at getting that raise is going in there prepared. Even with a job offer in hand, you can't just walk into your boss's office and ask for a raise because you deserve it. (You do, BTW.) It requires a little more finesse than that.
"State facts so you can show your boss what you're worth," Vicki Salemi, a career expert at Monster.com, told CNBC.
Here are a few tips for asking for a raise:
- Know the going rate for your line of work. Do your research on pay for similar positions using sites like Salary.com, Indeed or Glassdoor. Pay transparency laws help. A lot of states are now required to show what the pay is in job listings. But some of them are intentionally broad so it's a good idea to also ask former colleagues who have left the company to find out what competitors are offering.
- Summarize any increased responsibilities and projects you've taken on since you were hired and explain why what you're doing now is worth more than the rate you got when you were hired.
- Highlight your accomplishments on the job and the value you bring to the company. Where possible, quantify that in numbers — increased sales by X%, brought in X number of new clients, etc.
- Reiterate why you like this job — and working here. If you come off as a disgruntled employee who just wants more money, that will be a harder sell. Remember: We are only willing to pay more for things we think are worth that extra money. So, think of that when approaching your boss — make sure you convey that you're worth it. That you are someone they want to keep on the team.
It's also important to keep the timing in mind. If your company is doing a round of layoffs right now, maybe don't go in asking for a raise — unless you have a competing offer in hand and you're ready to walk.
And, remember: Just because you know how to ask for a raise and have a strong case doesn't mean you will get it. So, be gracious regardless of the outcome.
If you get turned down, maybe end the conversation with something like: "I understand. Maybe we can see what the landscape looks like in six months and revisit the conversation then."
Then set a calendar reminder to set up a meeting with your boss in six months.
And, ask your boss what you can do in the meantime — picking up new responsibilities or skills — in order to set yourself up for a future promotion and raise.
And, just for good measure, here are five things NOT to say when asking for a raise.
Using a side hustle to beat inflation
With all the layoffs and economic uncertainty, you may not feel like gambling and starting over at a new company right now. And your boss may not be able to give you a raise. But inflation isn't waiting for anyone — eggs cost 70% more than they did a year ago! Butter is up more than 32%.
One way to beat inflation without leaving your full-time job is to start a side hustle. There are so many options — jobs you can do from home, jobs with flexible hours, jobs that once you set them up bring in passive income, etc. And, who knows, you might just find your next big thing — the thing you might one day leave your job for.
But where do you start?
First, think of things that people need — jobs that don't require a business plan. Just plug and play.
Three of the most in-demand side hustles for 2023 are:
- Staffing an upcoming event. You can find these listings on sites like Indeed, ZipRecruiter and LinkedIn. Or create a profile on TaskRabbit with the kinds of work you're interested in.
- Take care of a pet. You can sign up with a site like Rover, which helps match pet owners with sitters.
- Tutor in a subject you know. You can advertise locally on a Facebook group or other neighborhood board or with sites like Varsity Tutors or Wyzant.
Think of things you're passionate about! Jeff Lerner, who went from broke musician to self-made millionaire thanks to side hustles, shared with CNBC Make It some of his favorite side hustles, which include selling stock photos and creating playlists.
There also are some other jobs you might not have thought about like transcribing audio, product testing, mystery shopping or selling unwanted stuff.
Another thing to consider is a side hustle that will generate passive income once you set it up — like printing T-shirts or printable downloads. Search a site like Etsy to generate some ideas. Find out what some of the most popular items and downloads are and see what appeals to you.
"Everyone is entrepreneurial in some way," Lerner said in a recent tweet. "You just have to find your unique way of tapping into it."
More from CNBC:
- The secret to asking for a raise and getting it, according to a self-made millionaire
- It's worth it to bring up inflation at work, even if you don't get a raise now
- How to ask for a raise — even if it's your first job out of college
- 9 in-demand side hustles that can be done from home—and how much they pay
- Virtual assisting is a side hustle that can pay as much as $100 an hour—here's how to get started
- 3 ways to make money off things you already own—one of them brings in up to $39,000 a month
— With reporting by Lorie Konish, Morgan Smith, Jennifer Liu, Greg Iacurci and Gili Malinksy.
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