Receiving a job offer is an exciting time. On one hand, you have a golden opportunity – a new job, more money, or a chance to turn a new leaf. On the other hand, this also might be a difficult decision, one that should be taken under careful consideration.
Luckily, most employers understand you need to take some time evaluating a job offer, and they typically do not expect for you to accept or reject the offer immediately.
You should consider a number of things when evaluating a job offer. It feels good to get a job offer, but you need to weigh out the opportunity carefully.
Is the hourly wage or salary fair for the position? Will the organization be a good fit? Will you enjoy the work? What are the opportunities for advancement? Is there opportunity to move up? How about the benefits? Do they offer insurance or a 401K?
These are all things you should consider carefully when thinking over a new job offer, and the following steps below will help you make this life changing decision whether this is your first job or are changing careers?
Evaluating Salary and Benefits
There are two things to consider when evaluating the compensation package of a job offer.
- Is the salary and benefits fair for the market?
- Will this salary be able to support my lifestyle?
Is my Salary Fair?
When evaluating a new job offer, it’s often difficult to obtain a good understanding of the fairness of the compensation package. This is something you should research thoroughly before accepting the job offer.
The oldest trick and one of the best sources of information on competitive salaries can be from friends, family, and fellow students or alumni in the same industry and in similar jobs, especially if they were hired recently.
Although, with the ever-increasing role of technology, there are many online tools that you can use to dial-in on good number.
PayScale vs. Salary.com
PayScale’s uses user submitted data in order to come up with salary information. Although PayScale is a wonderful site for salary research, some employers have issues with this approach and think that getting data from random employees skews the accuracy of the results.
Salary.com uses employer verified data from over 450 salary surveys. In order to use this data, they are locked into a non-disclosure agreement so it’s difficult to verify the reports they use, but Salary.com seems to be the most trusted by career advisors.
One thing is certain… Both sites are valuable, and I would suggest comparing both when researching your salary.
How to use Salary.com
Salary.com has hundreds of thousands salary data points which you can be searched to find comparable salaries for almost any profession. We’ll go through a quick example of how to use and search for the right data.
Go to the Salary.com homepage and search for US Salaries by entering your job title and location.
Refine your search further by checking or unchecking the appropriate boxes to find job titles / descriptions that closely match your desired position and industry.
Sort through the search results to find job descriptions that are the closest fit to the job you were offered.
You’ll find a lot of interesting data for your profession including:
- Average Years of Experience
- Education Level
- Company Size
But… What we are really interested in is the free salary report. So click on the green “Free Salary Data” button.
Then click on the prompt to “View my Results.”
Jackpot!!! Now you have a handy little graph that shows the median salary for your position!
It takes a little digging to find the right job description matches, but this is a handy tool when you need a quick way to compare salaries vs. a job offer.
Cost of Living
When considering a job in a different city, you may want to consider the difference in cost of living, as there could be significant differences in housing, healthcare, and even groceries between different cities.
Someone that makes $50,000 in Houston, Texas would need to make roughly $83,000 in San Francisco in order to keep the same standard of living. NerdWallet has a handy cost of living calculator you can use to see the difference between cities.
Depending on your job, you could be required to work greater than 40 hours per week. As an hourly employee, you may be entitled to overtime or compensatory time-off for working extra hours depending on local employment laws. Find out from your prospective employer how many hours you are expected to work a week and if overtime or time-off is earned for working overtime.
Commission, and Bonuses
Many jobs, such as sales, offer commissions or bonuses for meeting certain targets. This will need to be taken into account when evaluating your overall compensation package, but you must remember that bonuses and commissions can be difficult to evaluate during the job offer stage.
Most people’s top concern is their base salary, but benefits are an important part of the overall compensation package.
Vacation is a great perk that will allow you to take some time off to refresh, recoup, and come back better than ever. You’ll want to know how much vacation is offered in the first year and if it is accrued or earned. Generally, the average vacation allowance is two weeks and increases with seniority over the years.
Many companies offer paid holidays. Typically the number of paid holidays ranges from 6 to 12, including some of the following: New Year’s Day, a day for Easter, Memorial Day, Independence Day, Labor Day, Thanksgiving Day (and sometimes the following Friday), and Christmas Day. Floating holidays are also common where you can use at any time you like.
Saving for retirement is important, and a 401K is a great way to save. Most employers also offer to match contributions up to a defined percentage. If you don’t put anything else into your 401K, at least put in a percentage to match your maximum employer contributions. This is free money!
Medical, Dental, and Vision Insurance
Medical expenses can be expensive and having the proper health insurance is a must. An employer sponsored health care plan is an excellent benefit and something that you should carefully consider.
Disability insurance is one of those insurances that you don’t really think about until it’s needed. In the case that you are injured, disability insurance will pay a percentage of salary in either short term benefits or long term benefits.
Life Insurance & Accidental Death Insurance
You may not care about life insurance when you’re single, but once you have a family they become extremely important. To put it simply, these insurances ensure that your family will have money in the case that you pass away or are killed in an accident.
Evaluating the Company
You should have already done some preliminary background screening on the company when you went to the job interview, but now that you have the offer, it’s a good idea to do some research to make sure that this is a place that you really want to work.
You will typically want to look at things like the company’s culture, age, size, location, and it’s financial status.
Using Google to Find a Company’s Latest News
News stories and articles can give a lot of insight into a company’s successes, failures and future plans.
Google has changed the way the world searches for information. In the old days, we had to go to the library to really dig into articles and news releases of your target company. Now, you can find almost anything online.
So everyone knows how to search on Google, but not everyone knows this little hack to search only recent news.
Let’s say you were offered an entry-level jobs at Enterprise Rent a Car. You would go to Google and Type in “Enterprise rental cars.”
Once you’ve been brought to the results page, you’ll see a small bar listing Web, Maps, News, Shopping, etc. Click on news.
Now you’ll see the latest new results for Enterprise:
In the recent news, you’ll be able to quickly find the following (as of July 7th, 2014):
- Enterprise is seeing tremendous growth in European markets
- They are increasing fees at the Philadelphia Airport
- Enterprise is adding 250K cars for July 4th
- And the list goes on…
Digging Into the Details of Annual Reports
If it is a publicly traded company, you can go to the company’s website and download a copy of their latest annual report.
Take Apple for example. Go to Google and search: “Apple Investor Information”
There is a lot of useful information on Apple’s Investors page, especially when researching a potential employer, but we’re particularly interested in finding their annual report.
Click on the “Financial Information Page” and you’ll be brought to a page with Apple’s 10-K Annual Reports.
Annual reports contain a ton of information about your prospective company, including the following:
- Letter from the chairman
- Sales and marketing
- Ten-year summary of financial results
- Management discussion and analysis
- Letter of CPA opinion
- Financial statements
- Subsidiaries, brands, and addresses
- List of directors and officers
- Stock price history
Talk to People Who Have Worked There Before
You can find out a lot of information through research alone, but talking to someone who has worked there before can give some great insight into the company culture; although, sometimes you should take people’s opinions with a grain of salt. If they were left with a bad taste in their mouth, this doesn’t mean that you’ll feel the same way, but it does help you make an informed decision.
The best way I’ve found to find former employees is LinkedIn. If you don’t have an account, sign up! It’s free and great for job seekers.
Simply go to LinkedIn’s search and search by company. Type in your company, we’ll say Best Buy for this example.
Then you’ll want to look at the right side and look for the “How You’re Connected” tab. Click on “See All” and now you have a list of current and former employees in which you can contact.
If you want to talk to someone who is a former employer, do an advanced search, and scroll down to “Past Company” to limit your search to people that have worked here in the past. Unfortunately, this will still show people that have been promoted and have their past role on their profile is well. It’s not foolproof , but it works!
You can also find an organization’s background information at your online or at your local library using the following resources:
- Dun & Bradstreet’s Million Dollar Directory
- Standard and Poor’s Register of Corporations
- Mergent’s Industrial Review (formerly Moody’s Industrial Manual)
- Thomas Register of American Manufacturers
- Ward’s Business Directory
The Bureau of Labor and Statistics also has an excellent resource that provides recent projections of industry growth, job outlook, and more. It can be found here:
Also, if you’re in college or are a recent alum, you can use your university’s or college’s career center to find additional information you may not be able to find at your local library. You’ll have to ask someone within your career center as each one if different.
Do you believe in the business and its mission?
If you are aligned with the business and its mission, you will feel happy to show up to work and fulfilled by it as well. If you don’t believe in the company’s mission, you could quickly get bored or frustrated with the way they do business.
Should I work for a large organization or a small company?
Small companies offer a chance for more responsibility and authority. You’ll have more responsibility because you will have to wear multiple hats – doing the job of multiple roles you would find in a larger company. You’ll have more authority because you’ll be much closer to senior management, and it’s easier to see your contribution to the overall success of the business.
Large firms typically offer more training, greater opportunity for advancement through multiple career paths and more managerial levels, and may have greater perks and benefits.
Should I work for a startup or for an established company?
Working for a startup can be stressful. They experience high failure rates, and you may have to work long hours. On the other hand, the excitement of creating something new and building a company can often outweigh the risk. Many times, startups also offer equity stakes where you share in the success of the company.
Established companies offer more job security, but you may not have as big of an impact on the organization.
Private or Public Company: Does it matter?
Private companies are primarily owned by families or an individual. Sometimes, key positions are held by family members or friends which can hinder your chances for advancement.
Public companies are run by a board of directors and CEO who are responsible to the company’s shareholders. Public companies do not experience as much cronyism and positions are open to anyone.
Does this industry have a long term success rate?
If you are really concerned with job security, jobs in rapidly growing industries are best.
Where is the job located?
Will you have to relocate for this position? If so, you’ll want to consider the cost of living and availability of transportation and housing. If you have kids, you’ll also want to assess the quality and level of education, child care, and other amenities.
You’ll also want to consider your commute. Whether the position is in the same city or if you’re moving across the country, your commute is a big part of your day to day schedule and can account for over 300 hours of your time each year.
Do your interests match the work and does the position make good use of your skills?
Are you interested in this type of work? If not, you may quickly get tired of the work and become unhappy in the position. Make sure the job aligns with your interests or at the very least, make sure that this position is a stepping stone in order to get you where you want to be.
Do your skills match the skills needed for the job? If your skills do not match you could become overwhelmed with the new job. Make sure that the skills needed are something you want to develop in order to broaden your skill set and work experience.
The more you know about the job and industry beforehand, the better. Take time to learn the industry. Gain work experience through internships, summer jobs, part-time employment, or even temp work.
How important is this role in the company?
Obtain an explanation of the job’s roles and duties and where you will fit in the organization. Who will you report to and what level do they hold in the company. This should give you some background of your role’s importance.
Can you handle the hours?
Do you have a regular schedule working regular hours, or will you be expected to work nights, weekends and even on holidays? You will want to decide how this will affect your personal life. The majority of jobs follow a schedule, but other jobs may require late nights and/or overtime to meet deadlines or to better serve customers. Make sure you can handle the hours before accepting the position.
Turnover: How long do current and former employees stick around?
High turnover is a dreaded effect of a poorly run business or bad management. If people aren’t sticking around, try to find out why they are leaving. It could be a sign of a bad business and on the flip side, even a sign that the training you receive is preparing you for other opportunities.
In order to stay interested in the job, you will need a chance to grow your skill set, increase your salary, and have opportunities for advancement in order to gain more responsibility and power. A lack of these types of opportunities can lead to boredom or frustration and may make you want to find a new employer.
Does the company invest in its employees? Do they have a training plan? Will you learn valuable new skills?
Training and expanding your skill set is an important part of developing your career. Ask the company if they have a training program or do they have a budget for third party training.
You should also ask the employer about promotion possibilities. What’s the next step in the career ladder? What sort of timeline are you looking at for advancement opportunities? Can you apply for other internal positions within the organization? These are all things you’ll want to know to get an understanding of how you can grow with the role.
Other Useful Resources
National, State, and metropolitan area data from the Bureau’s National Compensation Survey are available from:
Data on earnings by detailed occupation from the Occupational Employment Statistics (OES) Survey are available from:
Although receiving a job offer can be a very exciting time, it’s always smart to really evaluate the opportunity to ensure that the offer is fair, and that the job is something you will enjoy and excel in. By using these tips, you’ll be well equipped to when it comes time for evaluating a job offer.
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