Upon being offered a job, the first step should be to pause and enjoy your good fortune. (Jobs are pretty scarce, if you haven’t heard.) Then, to start salary negotiations, toss out a ridiculously high dollar figure. The request may seem like a joke ($100K for an administrative assistant gig? Ha!), but there are indications it’ll help you get more money regardless.
Todd Thorsteinson, a University of Idaho psychology and communications professor, recently published the results of a few salary experiments in the Journal of Applied Social Psychology. (Hat tip to Harvard Business Review and lifehacker.)
In the experiments, participants entered into a simulated job salary negotiation—some volunteers were job candidates, others hiring managers. Would-be candidates previously had annual salaries of $29,000 and were offered new jobs as administrative assistants. When the topic of salary came up, some participants were instructed to kiddingly request $100,000—and those who did so wound up getting 9% higher offers, on average ($35,385 vs. $32,463), than those who played it straight.
All of this was simulation, of course, and there’s no way to know exactly how a real-life hiring manager would react to an inflated salary request, even one plainly made in jest. But the experiment reveals something about human nature and how negotiations often play out.
Thorsteinson points out that, in most negotiations, the final agreed-upon number is influenced by the initial figure that’s tossed out, which serves as an “anchor.” This is the case even if that initial figure is pretty much a joke.
Many retailers, in fact, use “anchoring” all the time, and their anchor prices—or original retail prices, which few if any customers ever pay—are pretty much jokes. But they serve a purpose: In the retail world, an inflated “original” price may exist mainly as a reference point to make a discount seem all the more substantial and impressive to the customer. With the anchor price listed, the consumer perceives the item as more valuable.
In the same way, no matter if you’re negotiating for a salary or a used bike at a garage sale, it’s likely that the initial figure tossed out will serve as an anchor, and will influence the final dollar amount agreed upon with a handshake.
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