For weeks now, you’ve been on the phone with hiring managers, trying to convince them that you’d be a good fit for that summer internship.
You’ve had several rounds of interviews, sent emails back and forth, and finally, you are made an offer. From your dream company.
You know you’ll love the work, and the position will an amazing learning opportunity. But the pay is not as high as you expected.
Should you negotiate?
The short answer is: YES.
Even if you feel uncomfortable talking about salary and don’t want to jeopardize your relationship with your future boss. Even if you worry about leaving a bad impression, or having your offer withdrawn.
You can have a lot of fears and worries about negotiating salary, but most of them are totally unfounded. After all, the company made you an offer because they want to hire YOU – and not some random other guy.
This puts you in a position of power, and in 90% of cases, that means your best bet is to give salary negotiations a go.
Negotiating with your future manager brings about two main benefits
- Signalling value: Having a professional conversation about salary signals to the hiring manager that you know your stuff, and that you can be trusted.
- Financial value: A single raise today will compound over the rest of your career, making it much easier to get to a point of financial freedom.
Let’s look at teach of these in a bit more depth:
Negotiate to build credibility and trust
Especially early in their careers, most people don’t feel confident talking about salary. They worry that they’re not experienced enough, and they’re grateful to even get an offer. To them, an internship is a fast pass to a graduate job and a chance to get hired by the company further down the line.
Top performers, however, take an entirely different view. For one, they see their internship as a learning experience. But most importantly, they know their worth and believe in the value they can add to the company – whether that’s a fresh pair of eyes, a unique perspective or a rare skill.
By asking for a higher internship salary, they show the company that they are confident in the quality of their work. This helps them set a good tone for the internship, and creates expectations of mutual value on both sides of the table.
On a more subtle level, you can also leverage negotiation to hint to the hiring manager that you don’t shy away from tough conversations. That way, they’ll know they can trust you to stand your ground with customers or flag difficult issues inside the company.
Talking about internship salary also lets you set expectations with management early on, which can help if you are hoping to stick around full-time after the end of your internship. Right from the outset, you are showing the C-suite, your manager or HR, that you expect to be valued – financially – for the work that you do.
And so, even if you get a ‘no’ now, you can ask what it would take to see your salary raised, work your hardest to do just that, and then come back at them with your successes to help you negotiate a significant raise in six- or twelve-months’ time.
All about money: the financial value of negotiating
Earning a reasonable paycheck allows you to become financially independent from parents, grants or even loans. It covers basic living expenses like rent and food while you work for the company.
Of course, every additional dollar or euro earned makes it easier to afford the internship and improve your quality of life.
For example, an extra 100€/month is peanuts to the company, but it can make eating out with friends at your favourite restaurant or going on a short weekend trip much more affordable.
If you invest these 100€ well, they could even be worth an additional 70,000€ over the course of your career. Now, imagine how an additional 200€ or even 400€/month could change your life. After saving the money up for 1.5 years, you could even buy your own small car or start a side business.
And, in the long run, it gets even better than that.
Because lots of companies do something called percentage-based raises. The way this works is that after each review period (usually once or twice a year), salaries increase by a certain margin.
This is where having a high starting salary – even as an intern – can mean the world, because the salary difference between you and your colleagues will become more noticeable year by year.
Suppose you started out with 1100€/month, while your friend had a starting internship salary of 1000€ a month. If you both get a 2% raise each year, this is what your salaries will look like after a few years:
|1 (starting salary)||1100||1000|
As you can see, that single 100€ raise at the start of your career will earn you an additional 1100€ in the next ten years – without any additional negotiation or promotions on your part. Of course, as you move higher and higher on the career ladder, the financial difference becomes even more pronounced.
When you shouldn’t negotiate your internship salary
We’ve seen the benefits of negotiating your internship salary, both on a personal and financial level. But now, let’s come back to the 10% of cases when it might be wiser NOT to talk about compensation.
Case 1: You haven’t prepared in advance
Before you bring up compensation with your manager, you need to have done your research. At the very least, you should figure out:
- Salary ranges: How much people in your industry and/or position typically earn?
- Your USP: What unique value can you provide to the company, if they hire you? How much is this worth to the hiring manager in financial terms?
- Strategy: How will you go about negotiating pay? What tactics and techniques will help you close a fair deal?
Case 2: Your offer is already on the high end
Inexperienced managers may be desperate to get you on board, particularly if the company has struggled to hire people in the past. In that case, they may overestimate the value you can provide and offer you a paycheck that puts you in the top 2-5% of internship salaries in your area.
Unless you have any extraordinary skills to impress the hiring manager with, you are usually best off moving quickly to accept and close the deal. This is because they can’t go back on their word once they’ve signed a contract. Whereas if you started talking about raising your internship salary, they might do their research, find out that you’d be overpaid and withdraw their offer.
Also, the higher your salary, the higher the expectation on you to deliver. In fact, expectations can become so high that they are impossible to meet, putting you under a lot of pressure and ultimately leaving your manager disappointed.
Avoid this all costs – but equally, don’t sell yourself short.
Case 3: You haven’t received a written offer yet
Only bring up compensation AFTER the company has made you an offer. This stops you from coming off as needy and puts YOU in a much stronger position to negotiate.
By this point, the hiring manager already invested at least a few hundred euros in recruitment, meaning that they won’t want to lose you.
By now, you also know how much they are willing to pay, and the fact that you have a written offer means you can reflect on your aspirations, think through your strategy and come up with a good counter-offer.
Case 4: The position you applied for is unpaid
When the job description says that an internship is unpaid, there is little point in going through the entire hiring process and starting to negotiate once you’ve been made an offer.
If you really like the position, but can’t take it up without financial support, your best option is to call the company with a strong pitch on why you are the perfect candidate, and then inquire if they would consider turning the internship into a paid position.
This not only saves you a lot of time, but also helps you figure out why the position is unpaid. Is it because the company is looking for cheap labour and doesn’t expect anything in return? Or are they struggling financially?
Many times, you will find that managers who aren’t willing to pay you, can’t commit 100% to creating a good experience. Instead, you might just be there to help with mundane tasks like copying stuff, getting people coffee or assisting co-workers with repetitive work.
That’s why I always recommend looking for paid opportunities. With paid positions, the company is throwing away money if they don’t let you take on real tasks, and a fair level of compensation shows that the team is willing to invest in you, and develop a mutually beneficial relationship.
Case 5: The firm pays the same internship salary to all interns
Finally, it helps if you are aware that large firms often work with something known as pay scales. The way a pay scale works is that applicants are grouped by level of experience, and then all candidates in one group are offered the exact same compensation.
Large companies often use this to make pay fairer, and reduce the likelihood of pay-based discrimination. For example, I think Volkswagen Germany offered all interns in a certain division of their company a paycheck of 1000€ per month.
These pay scales mean you have a lot less wiggle room to negotiate your internship salary – UNLESS if you can offer a standout portfolio or a set of unique skills.
To avoid burning any bridges, I still recommend taking a more cautious approach and figuring out whether it’s okay to discuss salary first. For example, when you talk to the hiring manager, you can subtly weave pay into the conversation, by saying something like:
‘I’m super excited to start the internship at Volkswagen, and I think I can bring a lot of value to the company by doing X, Y, and Z. As you know, my experience with A and B puts me ahead of many other interns. I was wondering whether it would be appropriate to adjust my compensation to reflect this?’
That way, you make a strong case for why you think you deserve to earn more, without being overly pushy. You also give the hiring manager a cop-out in case they don’t have any flexibility or the budget is fixed. By asking politely, you also keep the relationship on a positive note, which will help you if you decide to take up their offer and start working at the company.