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What to Do if You Think You're Underpaid

Stella Morrison
Stella Morrison

Being underpaid is frustrating and demoralizing. Here are the steps to take if you think you're being underpaid.

  • Be sure to compare your salary to those of other employees at both your company and other companies.
  • Some of the most underpaid jobs include those that serve children, the elderly and the sick.
  • When negotiating a pay raise, present the strongest case possible, backed by evidence.
  • This article is for employees who believe they are underpaid and seek salary adjustments from their employers.

When you think you're underpaid, you feel unappreciated and overworked, and it makes doing your job a drag. However, with the right game plan, preparation and negotiation skills, you should be able to increase your salary. Here are the steps to take if you think you're being underpaid.

Eight ways to tell if you're underpaid

One of the most common questions people ask about salaries is how to find out if they're being underpaid. After all, it can be uncomfortable to ask coworkers about their salaries for comparison. Here are eight ways you can determine if you're being underpaid.

1. Conduct online research.

Fortunately, some sources can tell you what people get paid, on average, for a specific position in your industry, which can vary based on location.

"The first step is to figure out what you're worth by understanding average salaries for people in your role and those surrounding it," said Rachel Bitte, chief people officer at Jobvite, a company that provides recruiting software. 

Online resources such as Glassdoor, Salary.com, PayScale, LinkedIn, Monster and Indeed can help you determine if you're underpaid. Be sure to account for your location and job title when you're using these websites to figure out if your pay is appropriate.    

If you go into a salary negotiation without doing your research, it could hurt your career and chances of getting what you deserve. "Go into any salary conversation without knowing the facts, and you run the risk of botching the whole process," Bitte said.

Key TakeawayKey takeaway: There are multiple sources of salary and wage information by industry that can be accessed for free with a simple Google search. Try sourcing data from a few sites.

2. Your responsibilities have increased, but you did not get a raise.

Whether you've taken on a larger workload when a coworker left or you were promoted, a change in responsibilities should always signal that it's time for a raise. However, suppose you were not given extra compensation for your increased workload. In that case, it's a sure sign that you're underpaid compared to others in your field with similar titles or responsibilities on their plate.

3. You haven't had a performance review.

Your performance review is dedicated to discussing the work you've been doing and the steps you can take to grow in the company. A performance review is an ideal opportunity to discuss salary. Still, if you haven't had a performance review, chances are, you haven't had a natural opportunity to bring up your compensation.

4. Your salary does not reflect specialized training or education.

If you have a Master's degree or advanced education or have specialized knowledge in your industry, you are worth more to your employer (and competitors). 

5. Your salary has not been adjusted for inflation.

Also called cost of living adjustments (COLA), some companies build these in automatically each year to help keep up with the rising prices of daily living across the board. If you have not received a cost of living adjustment, it may be time to discuss a general raise.

6. A colleague or recruiter has told you that you're underpaid.

If you feel uncomfortable surveying your coworkers about their salaries, outside sources in similar positions can help give you some perspective. Recruiters who talk to dozens of companies and hundreds of candidates have a good sense of what your salary range should be. In contrast, colleagues in other companies may feel more comfortable sharing their salaries with you, as you don't work together and it won't create tension.

7. More recent hires make more money.

If you see job listings from your company offering salary ranges at or more than what you make, it may indicate that you should get a raise. Keep an eye on your company's job listing and take note if they list compensation publicly.

8. The company has grown, but you have not benefited personally.

If your company recently acquired a big client, received funding, or launched a new service, these are signs that the organization as a whole is in a growth position. This may be a good time to ask if you can receive a raise, especially if it's been a while.

What are the most underpaid jobs?

Certain jobs tend to deserve much higher pay for what they provide to society. These include public school teachers, registered nurses, paramedics and social workers. Unfortunately, people in these professions are often underpaid, so those who work in these fields need to seize every opportunity for a raise.

Along with researching online, you can consult with people in your industry, such as former coworkers and contacts on LinkedIn.

"Ask former bosses and colleagues who no longer work with you for a going rate," said Vicki Salemi, a career expert at Monster. "Ask them to consider if they were to hire someone with your experience, skillset and credentials, what would the salary be?"

Salemi also suggested asking your company because some companies provide full transparency into salaries through online databases or HR departments. "It's okay to ask for pay ranges for your position; just be mindful that pay ranges may overlap, and the high end of your current role may be at the low end of the role above you," she said. 

What does underpayment mean?

It's also important to have a definition of "underpayment" in mind. Most people think that underpayment means they are getting paid less than they feel they're worth. In reality, however, the market dictates what someone deserves to be paid. Therefore, it is critical to discuss salaries with coworkers and former bosses with this definition of underpayment in mind. If you are being paid less than someone else for the same job in the same industry and location, especially if you have more experience than that person, you're being underpaid.

Once you've done your research and chatted with people in your industry, it's time to talk with your manager about a raise. Though this may be intimidating, if you don't ask, the answer is always no.

How do you prove you're being underpaid?

Eventually, if you say you're being underpaid, you're going to have to prove it. There are a few steps you can follow. First, show the manager what you're currently being paid. Then, show the manager or supervisor as much evidence as possible that other people who work the same job are getting paid more. This might be evidence from salary survey sites, or it might include salaries of people who have the same position at other companies. It might even include the salaries of coworkers with the same title at your company.

"The truth is that negotiating your salary is a necessity, especially if you are underpaid," Bitte said. "Increasing your income now can change the trajectory of your future compensation, which is crucial to maximizing your earning potential throughout your career."

Salemi recommended asking for a raise after you've just accomplished something big and it's fresh in your boss's mind. "Another time is before or during a salary review, not after," she added. "Depending on the company, raises only occur once a year, so if you miss that window, you're out of luck."

TipTip: Track your accomplishments with the company and be specific. Has the budget you manage grown? Have you saved the company money with a good idea? Bring up specific points to strengthen your negotiation.

What if you don't get a raise?

So, you've done your research and know what you're worth, but your manager doesn't want to give you a raise. What should you do?

"Don't give up," Bitte said. "Most younger workers presume that a 'no' is the end of the conversation, but that's simply not the case. It's often unlikely your boss will give in on the first ask, so think of salary negotiations as an ongoing conversation."

She suggested following up a couple of months later and noting the contributions you've made to the company since the last conversation.

However, if your manager still isn't willing to give you an increase after multiple conversations, it may be time to start looking for a new gig. 

"If you ask for a raise and receive a 'no,' one option is to stay and continue to be underpaid and overworked," Salemi said. "Another option is to leave and search for a new job."

Image Credit: bunyarit klinsukhon/Shutterstock
Stella Morrison
Stella Morrison
Business News Daily Contributing Writer
Stella Morrison is an award-winning writer who focuses on marketing for small businesses, including useful tools and best practices that help business owners introduce their products and services to new audiences. She is also a digital marketing professional who has worked with leading brands in the tech industry.