Ex-Google RECRUITER EXPLAINS: How to Answer 'What Are Your Salary Expectations?' AND How Comp Works

Summary

This video script offers guidance on handling the common interview question about salary expectations. It explains that recruiters aim to assess alignment with the company's pay band and set expectations for offer discussions. The script delves into the components of compensation, including fixed and variable pay, and the importance of benefits. It advises job seekers to research market rates and suggests strategies for responding to salary inquiries, emphasizing the importance of not revealing too much too soon and the value of redirecting the conversation to gather more information.

Takeaways

• 💼 When a recruiter asks about salary expectations, it's not a trick question but a way to assess alignment with the company's budget and payband.
• 📈 Companies set a budget for salaries at the beginning of the year through a process involving finance and headcount planning.
• 🔢 The payband for each job level has a minimum and maximum, and companies aim to keep compensation within this range for fairness.
• 🤝 Understanding the different components of compensation, such as fixed compensation, bonuses, commissions, and equity, can help in negotiating better offers.
• 🏥 Benefits packages, including healthcare, can impact take-home pay and should be considered when evaluating an offer.
• 🧐 Researching salary expectations through websites like Glassdoor, Salary.com, and the Blind app can provide useful but not definitive data.
• 🗣️ Redirecting the conversation when asked about salary expectations can help gather more information about the company's compensation structure.
• 💬 Offering a salary range based on research and the job requirements can be a strategic way to communicate your expectations without being too specific.
• 💼 When providing a salary range, consider your experience, skills, location, and the market rate for the position.
• 🤝 Be open to discussing the entire compensation package, including benefits and growth opportunities, rather than just focusing on base salary.
• 📝 Remember that salary expectations are an opportunity to communicate what you value and expect from a potential employer.

Q & A

Why do recruiters ask about salary expectations during a job interview?

Recruiters ask about salary expectations to assess if the candidate's expectations align with the company's payband and to set the candidate's expectations for the offer conversation.

How do companies determine their budget for hiring new employees?

Companies determine their hiring budget at the beginning of the year by coordinating with finance, looking at headcount, current salaries, and the amount they can set aside for new and internal promotions.

What is meant by 'headcount planning' in the context of hiring?

Headcount planning is the process where departments report their staffing needs to finance, who then allocate the budget for hiring based on the company's overall budget.

Can you explain the concept of 'leveling' in the context of company compensation structures?

Leveling refers to the hierarchical structure within a company, with each level having a corresponding payband or salary range. It's similar to the rungs of a ladder, with each rung representing a different level of seniority and associated pay.

What is a 'Pay Band' and why is it significant in compensation discussions?

A Pay Band is the range of compensation for a specific level within a company, stretching between a minimum and a maximum. It's significant because companies aim to keep compensation within this band to maintain fairness and align with their pay philosophy.

What are the two main parts of a compensation package as mentioned in the script?

The two main parts of a compensation package are fixed compensation, which includes salary or base pay, and variable compensation, which can include bonuses, commissions, and equity.

Why is it important to understand the variable compensation portion of a job offer?

Understanding variable compensation is important because it can significantly boost one's pay based on performance, achievements, or company success, and it motivates employees to meet or exceed expectations.

What is the role of 'Equity' in an employee's compensation package?

Equity, such as stock options or restricted stock units, aligns an employee's interests with the company's long-term success. It can grow in value over time, potentially providing substantial financial benefits if the company does well.

How can benefits packages impact an employee's overall compensation?

Benefits packages can impact overall compensation by reducing out-of-pocket expenses for things like healthcare, which effectively increases the employee's take-home pay.

What are some strategies for responding to a recruiter's question about salary expectations?

Strategies include redirecting the conversation to learn more about the company's payband, offering a salary range based on research and qualifications, and expressing openness to discuss the entire compensation package, including benefits and growth opportunities.

What websites or resources are suggested in the script for researching salary expectations?

The script suggests websites like Glassdoor, Salary.com, Level.fyi, and the Blind app as resources for researching salary expectations, with a preference for the Blind app due to its anonymous nature.

Outlines

00:00

💼 Understanding Salary Expectations in Job Interviews

This paragraph discusses the common concern job seekers face when asked about salary expectations during interviews. It clarifies that this question is not a trick but a way for recruiters to gauge alignment with the company's payband and to set expectations for the offer conversation. The script explains how companies set budgets for new hires and allocate them based on headcount planning, which includes determining the necessary roles and corresponding paybands. The paragraph also distinguishes between fixed compensation (salary or base pay) and variable compensation (bonuses, commissions, and equity), emphasizing the importance of understanding the full compensation package, including benefits, for effective negotiation.

05:01

🔍 Researching and Redirecting Salary Expectation Conversations

The second paragraph provides strategies for job candidates to handle the salary expectation question by redirecting the conversation and deflecting when necessary. It suggests using online resources like Glassdoor, Salary.com, and the Blind app to research salary ranges but also cautions about the variability and self-reported nature of this data. The script advises candidates to ask recruiters about typical offers for the position to gain insight into the company's compensation structure. It also covers how to offer a salary range when pressed, by considering one's experience, skills, location, and market rates, and emphasizes the importance of being open to discussing the entire compensation package, including benefits and growth opportunities.

10:03

📈 Strategies for Discussing Salary Expectations and Recap

The final paragraph offers specific strategies for discussing salary expectations, including redirecting the conversation to learn more about the company's compensation structure and providing a salary range based on research and personal qualifications. It highlights the importance of being open to discussing the full compensation package and not just the base salary. The paragraph concludes with a reminder that discussing salary expectations is an opportunity for candidates to express their value and expectations, and it encourages viewers to like, subscribe, and watch a follow-up video on resume writing.

Keywords

💡Salary Expectations

Salary expectations refer to the amount of money a job candidate anticipates receiving for a particular position. In the video, it is highlighted that recruiters ask about salary expectations to assess alignment with the company's pay band and to set the candidate's expectations for the offer. It's a common concern for job seekers, as they want to ensure their desired salary is within the potential employer's budget.

💡Headcount Planning

Headcount planning is the process by which companies determine how many new employees they can hire based on their budget. The script mentions that finance departments collaborate with other departments to decide on the number of people needed for various roles, which is then tied to the budget allocated for hiring and promoting employees.

💡Pay Band

A pay band, as described in the video, is the range of compensation that a company can offer for a specific level within the organization. It has a minimum and a maximum, and companies typically try to keep salaries within this range to maintain fairness and consistency in compensation. It's a crucial factor in the recruiter's question about salary expectations.

💡Fixed Compensation

Fixed compensation represents the consistent, regular pay that an employee receives, such as an hourly wage or an annual salary. It's a key component of the overall compensation package and provides financial stability, unaffected by performance or business changes. The script emphasizes its importance in the context of salary negotiations.

💡Variable Compensation

Variable compensation includes bonuses, commissions, and equity, which are additional forms of pay that depend on performance or company success. The video script explains that these components can significantly boost an employee's pay and are part of the total compensation package, motivating employees to meet or exceed expectations.

💡Bonuses

Bonuses are extra payments made based on an employee's performance or the company's success. The script mentions different types of bonuses, such as sign-on, performance, and retention bonuses, which serve to motivate employees and can substantially increase their overall earnings.

💡Commissions

Commissions are payments based on an individual's sales performance, typically a percentage of sales. The video script notes that commissions are common in sales roles, where they motivate employees to reach higher sales targets, and they are part of the variable compensation.

💡Equity

Equity, in the form of stock options or restricted stock units (RSUs), is a component of compensation where employees receive shares of the company's stock that can grow in value over time. The script explains that equity aligns an employee's interests with the company's long-term success, potentially leading to significant financial gains for the employee if the company performs well.

💡Benefits Package

A benefits package includes various non-salary advantages offered by employers, such as health care, dental insurance, and vision insurance. The video script points out that the cost of these benefits can impact an employee's net pay and should be considered when evaluating a job offer.

💡Compensation Structure

Compensation structure refers to the overall framework of how an employee is paid, including both fixed and variable components. The script suggests that understanding the compensation structure is essential for job candidates to negotiate effectively and to know what to expect in terms of salary and benefits.

💡Salary Range

A salary range is a specified interval of potential earnings for a job position, based on factors like experience, skills, and market rates. The video script advises job candidates on how to provide a realistic salary range when asked by recruiters, emphasizing the importance of research and being open to discussing the entire compensation package.

Highlights

Recruiters ask about salary expectations to assess alignment with the company's payband and to set expectations for the offer conversation.

Companies set a budget for hiring and allocate it to headcount planning based on the needs of the company.

Levels or rungs on the career ladder correspond to Pay Bands with a minimum and maximum salary range.

Salary expectations should align with the payband to ensure fair compensation within the company.

Understanding fixed and variable compensation helps in negotiating a better offer.

Fixed compensation includes salary or base pay, providing financial stability regardless of performance.

Variable compensation encompasses bonuses, commissions, and equity, which can significantly boost pay.

Benefits packages can impact the effective salary by reducing out-of-pocket expenses for employees.

Researching salary expectations using websites like Glassdoor, Salary.com, and the Blind app can provide valuable insights.

When asked about salary expectations, redirect the conversation to gather more information about the position and company's compensation structure.

Offer a salary range based on research, experience, and the job's requirements to provide a starting point for negotiation.

Be open to discussing the entire compensation package, including benefits and growth opportunities.

In some states, companies are required to disclose base salary in job postings, which can inform salary expectations.

Salary expectation questions are opportunities to communicate your value and research to the company.

Providing a salary range helps set the stage for a discussion about the full compensation package.

The video offers strategies for effectively answering salary expectation questions in job interviews.

The importance of considering the entire compensation package, not just salary, when evaluating job offers.

The video concludes with a reminder to like, subscribe, and check out additional resources for resume writing.

Transcripts

so you're on the phone with the

recruiter and the recruiter asks so what

are your salary

expectations and you're sucked and you

don't know what to say cuz you're

thinking well is this a trick question

because they know how much they can pay

me but I know how much I want to make

but I don't know if they know how much I

want to make so I'm not sure what to do

and you're kind of freaking out then

this video is for you believe it or not

this is not a trick question it is not

meant to stump you it is not meant to

pigeon hole you the reason why

recruiters ask you what are your salary

expectations at the beginning of a job

interview is because they want to assess

a few things now before we get into that

what we need to do first is we need to

take a step back and we need to talk

about how companies determine how much

money they're going to pay you so at the

beginning of the year companies will get

together with Finance they'll look at

headcount they'll look at how much money

people are making they'll look at how

much money they're able to set aside to

hire new employees and promote other uh

like internal employees and what they'll

do is they will set a budget okay so

they're setting a budget over all for

this type of work now what they'll do is

they will take that budget and allocate

that to headcount now we call that

headcount planning now what will happen

is when they're doing headcount planning

they're deciding okay based on the needs

of the company these are the type of

people we need to hire so departments

will basically report up to finance and

say okay I need let's say a marketing

manager on my team or I need a software

engineer on my team who's a mid-level

engineer so they go up to finance they

say okay these are the things that I

need and then Finance goes hm okay well

based on our budget and the allocation

of the budget this is what we can offer

you in terms of headcount so whenever

you talk to hiring managers sometimes

they'll get like really bummed out cu

they say h yeah I only got like three

headcount approved when instead I wanted

five headcount approved cuz they wanted

five employees instead of three now

let's say there's a hiring manager out

there and they need to hire three people

on their team because that's what they

got allocated so the hiring manager goes

okay great so I got three headcount

allocated for this

leveling okay so let's talk about

leveling when it comes to leveling what

we want to do is we want to think about

it like a ladder so on a ladder we have

steps on a ladder also known as rungs so

when we're going up a ladder we're

putting our foot on one rung on the

ladder and then if you want to go up you

have to put your foot on the next rung

on the ladder and so on and so on okay

we call this levels now each rung so

each level on that ladder has we call a

Pay Band or a range for that level when

you're on a level that level has what we

call a Pay Band and that pay band

stretches between a minimum and a

maximum companies rarely will pay above

the maximum level because that could

mean that other people who already work

at the company are not going to be

making that amount of money and that's

going to throw off the company's pay

philosophy so what they do is they try

to keep compensation within that band so

that pay is fair for everybody at that

level when the recruiter is asking you

about your salary expectations what

they're actually doing are two things

number one they want to make sure that

your expectations are actually in

alignment with the payband that they can

pay within so that's number one and then

number two what they're doing is setting

you up so that when you have the offer

conversation with them you already have

an expectation of what the salary band

is and what a possible offer can look

like so this is actually to your benefit

and I'm going to show you how you're

going to use it to your benefit now

remember there's more than just your

salary when it comes to being

compensated for your time understanding

all of the different parts of an offer

will help you negotiate better so let's

talk about the two main parts fixed

compensation and variable compensation

let's start with fixed compensation

fixed compensation is your salary or

your base pay so this is going to be the

regular consistent pay that you get for

your job it's usually an hourly wage or

an annual salary fixed pay is going to

give you that Financial stability that

you're looking for and it's not affected

by your performance or any business

changes and this is the primary base for

your overall pay package now the second

part of your compensation is the

variable compensation portion let's talk

about bonuses bonuses are the extra

money that you get based on your

performance your achievements or any

company's success this can include a

signon bonus performance bonuses

retention bonuses bonuses motivate

employees to to meet or exceed

expectations and can help you

significantly boost your pay

commissions this is super common in

sales jobs because commissions are

payments based on an individual sales

performance a commission structure

usually includes a base salary plus

extra pay as a percentage of sales which

helps motivate employees to reach higher

sales targets and then lastly Equity

also known as stock so Equity pay

includes stock options or restricted

stock units know known as

rsus employees get shares of a company's

stock which can then grow in value over

time Equity it helps align an employees

interest with the company's interests

and their long-term success and if the

company does really well you could do

really really well now here's a bonus

tip now this isn't part of your pay but

it does have an impact on your offers so

when you're speaking with a recruiter

what you want to do is you want to ask

about their benefits p package so for

example when I worked for Tik Tok I

didn't pay anything for my healthc care

benefits which was awesome so if I

didn't have to pay out of pocket for

those benefits that was money that I got

to keep in my pocket but other companies

I've worked at I've had to pay hundreds

of dollars per paycheck just to have

medical dental uh Envision insurance and

that can have an impact on your end

paycheck now that you understand the

components that can go into an offer

let's talk about how you can do some

research now again full disclosure there

is no free website that exists that's

going to tell you exactly what a

company's pay philosophy is going to

look like and what your offer is going

to look like there's always going to be

some Nuance because the websites out

there that are free are relying on other

people to self-report their data but

it's still information that we can use

we just have to take it with a little

bit of a grain of salt so there's some

really great websites like glass store

salary.com level . FYI and the blind app

personally I'm a huge fan of the blind

app the reason why is because it's a

completely anonymous app but in order

for you to actually participate in the

app you need to have a work email so if

you don't that's okay but if you do but

if you do have a work email then you can

use it now let's strategize let's talk

about how you're going to answer the

recruiter when they ask you about what

your salary expectations are the first

first thing you're going to do is you

are going to do your best to redirect

the conversation redirect the

conversation and deflect as much as you

possibly can the reason why you want to

redirect this question is because when

you're in a recruiter phone screen

you're answering a lot of questions that

the recruiter is asking you you don't

really have the chance to ask the

recruiter the hiring manager the

interviewer any questions so you

actually don't have enough information

to be able to tell the recruiter what

your expectations are how would you know

so when the recruiter asks what are your

salary expectations here's something you

can say really appreciate you asking I

did some research online however I

understand that every company's

compensation structure can change over

time and I don't know enough about the

responsibilities of the position to

provide you with a range can you tell me

what a typical offer would look like for

this position again you're not being

rude all you're doing is redirecting the

conversation to allow them to tell you

what that pay band actually looks like

and side note depending on what state

you live in so for example I live in

California if you live in a state like

Colorado or New York most companies have

to disclose their base salary

compensation in their job postings now

strategy number two offer a salary range

this may sound a bit contradictory to

what I said before but I promise you

it's not there are some companies that

when you apply to the job they're going

to ask you in the job posting what are

your salary expectations let's say the

recruiter really insists that you need

to give them a pay range if that's the

case here's something that you can say

based on my research and the roles

requirements I would expect a base

salary in the range of $75,000 to

$100,000 this range reflects my

qualifications experience and

typical market rate for this position

here's how you're going to set a

realistic range take into account your

experience your skills your location and

what the expectations are um of that job

that you're applying for what you want

to do is you want to provide a range

that's not too narrow and not too broad

let's say you did some research and the

range is between $80,000 to $120,000 for

the base pay here's what you can say to

the recruiter given my experience and

expertise I'm looking to make between

between $80,000 to $100,000 in my next

role this range is based on my research

on similar positions my understanding of

the responsibilities and the skills that

I bring to the table I am open to

discussing the entire compensation

package including benefits and growth

opportunities so again what you're doing

is you are telling the recruiter hey I

understand that this job has a pay range

and I'm also telling you that I don't

have enough information to give you a

definitive number I still need

information before I can tell you what I

expect remember when someone asks what

are your salary expectations it is not a

trick question it's a great opportunity

for you to let the company know what it

is that you expect so to recap this is

not a trick question at all and I've

given you some techniques so you can go

in there and Ace this question now if

you like this video of course smash a

like button subscribe and if you need

help with a resume check out this next

video where I go in depth on how to

write an incredible resume thanks for

watching