Imagine that you just received a job offer for a position you are excited about. Now what? You might consider negotiating for a higher salary, job flexibility, or other benefits, but you’re apprehensive. You can’t help thinking: What if I don’t get what I ask for? Or, in the worst-case scenario, what if the hiring manager decides to withdraw the offer? In our new research, published in Organizational Behavior and Human Decision Processes, we investigated how accurate job candidates are in understanding their likelihood of jeopardizing a job offer if they negotiate. In our studies, we asked both candidates and managers to estimate the likelihood that a candidate who negotiates will have the offer rescinded. Across seven studies, with a total of 3,338 participants, primarily full-time working adults in the U.S. (many of whom had management experience), we found that candidates’ perceptions of this likelihood are consistently exaggerated: Candidates think they are much more likely to jeopardize a deal than managers report candidates are likely to jeopardize a deal when they negotiate. In some studies, we surveyed and compared the responses of job candidates and hiring managers. In other studies, we randomly assigned people to candidate or manager roles, and they negotiated either in person or via an online chat. These participants were incentivized with bonuses based on the characteristics of the final outcome, and whether they reached a deal at all. In five of the studies, we asked candidates and managers to rate (on a 1-7 scale) their perception of the likelihood of jeopardizing an offer by negotiating. Specifically, candidates rated whether they thought “The manager is likely to walk away if I negotiate” and “I might lose the deal with the manager if I negotiate,” while managers rated “I am likely to walk away if the candidate negotiates” and “The candidate might lose the deal with me if they negotiate.” In aggregate, candidates perceived the likelihood of jeopardizing a deal as 33% higher compared to managers (approximately 4.6 vs 3.5). The results were consistent among both men and women and across roles. Our research also shows that because candidates believe they are likely to jeopardize a deal by negotiating, they may avoid negotiating altogether. In the experimental studies, we asked candidates if they wanted to negotiate the job offer. About 46% of candidates chose to accept the offer as is. This reluctance to negotiate would make sense — if candidates’ perceptions were accurate. When we asked people about their actual experiences, we also found a low likelihood of negotiations that jeopardized an offer. In one of our studies, we surveyed 1,496 managers about offers made (and withdrawn) throughout their careers. We found that 94% of offers made were upheld, and that most of the managers had never withdrawn an offer. Why are candidates overestimating this likelihood? We document two reasons: First, candidates think of this interaction as much more zero-sum and competitive than managers. Candidates think that any gains on their end would come at the manager’s expense, and that any deal that would be good for the organization would be bad for them. For example, in one study, candidates perceived negotiations as more zero-sum and competitive at about 9% higher on a 1-7 scale compared to managers (approximately 4.4 vs 4.0). Second, candidates think they have very little influence or power in this interaction, compared to managers’ ability to influence the interaction. In the same study, candidates perceived their influence or power in the negotiation as about 20% lower than managers did (approximately 4.0 vs 4.8 on a 1-7 scale). Notably, we find that candidates were somewhat more accurate in estimating their likelihood of jeopardizing a deal when they perceived the negotiation as less competitive or zero sum (for example, when they considered mutually beneficial, win-win solutions for the manager and themselves), or when they had another, alternative offer (which provided candidates with more power and influence in the negotiation with the manager). Yet, even in these cases, most candidates still overestimated the risks of negotiating. Our research suggests that candidates should be less concerned about the likelihood of jeopardizing a deal by negotiating. If they’re anxious about the negotiation, candidates should: Remember our finding that very few managers have withdrawn a job offer. Reframe a zero-sum mindset by identifying potential win-win solutions in the negotiation. For example, maybe you care more about working remotely than about the small signing bonus. Your boss might really appreciate the savings and be flexible about where you work. Considering such solutions should help deflate an exaggerated concern about jeopardizing a deal. Research the norms about negotiation in your industry or organization. Are there colleagues or mentors you can ask about standard practices? Negotiate in a professional manner. You can reduce the risk of jeopardizing a deal by asking for reasonable concessions, and by showing interest and cooperation. Remember that negotiation affects both parties. Managers are often unwilling (sometimes even unable) to withdraw a deal, and having satisfied employees also helps organizations. Negotiating a job offer is hard. While there is a risk of managers pulling an offer if candidates negotiate, our research suggests that job candidates overestimate this risk and can often obtain better outcomes through negotiating a job offer.
