What to do if you are underpaid
When it comes to being underpaid, ignorance is not bliss. Remaining ignorant and over-trusting of an employer is causing millions of workers to lose out.
Eunice Asante, career coach at The Workers Journal explains how you can arm yourself with information to achieve your salary potential.
Am I underpaid?
I recently read an article that quoted Martin Lewis, the founder of UK company Money Saving Expert, and said that half a million people on minimum wage in the UK could be underpaid. One of the main issues in this post was that most underpaid people are unaware that they are underpaid.
This got me thinking back to a previous blog post I have written here where I discuss how to negotiate your salary. But before you can even broach the subject of negotiating your salary, you first need to clarify if you are underpaid.
We all risk being underpaid regardless of whether we are on minimum wage or not. Therefore, asking if you are underpaid is a question employees across all sectors and industries should be asking.
Why am I being underpaid?
Let's look at why employees are underpaid and what you must start doing today if you want to change this.
One of the biggest reasons why employees are underpaid is because most employees are unaware that others are earning more for the same work. Therefore, they don't ask for more money.
It may sound basic, but common misconceptions are that everyone with the same job title receives roughly the same wage. But this could not be further from the truth.
According to a UC Berkeley study in the USA, half of those surveyed believed they were earning the median pay for their occupation when only 20% of people were, with the rest earning far less, BBC cites.
Most people underestimate what others make regarding work and wages. This information holds us back from seeking better-paid jobs because we don't believe they exist. Or we are held back from asking for more pay within our current roles. As a result, we allow ‘low-paying employers to continue to pay lower wages because workers remain misinformed’. According to the UC Berkeley study, ‘10% of low-paying jobs would simply not be viable at current pay rates’ if workers were more aware of pay disparities, BBC cites.
What can I do if I am underpaid?
Two possible reasons come to mind when I think about why workers remain unaware that they are underpaid. The first is salary transparency.
Employers have had a big push to disclose company salaries to highlight pay disparities and close pay gaps. However, if salary transparency is ever going to work, we have to take responsibility for openly talking about our salaries. The buck lies with us workers.
There is a stigma around talking about money and a general reluctance to share salary information. But this is to our determinant because if we could all be bolder around sharing salary information, there would be more information floating around for our benefit.
The second reason is carrying out salary research when applying for a job.
Most workers tend to believe what an employer tells them about the salary expectations of a job role. Therefore, they do not carry out research or are not thorough enough with their research. Again, according to the UC Berkeley study, ‘if workers had access to accurate market salary data, they would demand more’, BBC cites.
What is ironic is that because of the pandemic, there is now a greater demand for workers. This means we are in the best position to demand higher wages. But if workers do not know they are underpaid, they will not seek better wages or employment elsewhere.
Why being underpaid matters
I recently had a conversation with a popular social media personality who questioned me on why it's essential for workers to negotiate their salaries.
We had an excellent discussion around this, and I realised that they failed to understand that the longer you allow yourself to be underpaid, the wider the gap between you and your better-paid peers grows. Think about the knock-on effect this can have on your financial security, experiences, and quality of life.
In turn, it makes it harder for you to catch up. For example, when applying for a new job, it's harder to justify significant pay increases than incremental ones. Also, being able to demand better pay tends to signify high calibre and an ability to produce, which in itself can open doors.
However, the opposite is also true. I have witnessed many workers who felt devalued and unappreciated and struggled to contribute at work because they knew they were underpaid. Both circumstances can lead to a self-fulfilling prophecy. This is why we all need to take the issue of being underpaid seriously.
Through my success coaching, I take underpaid workers or workers who want to negotiate their salaries but do not know how to do, and coach them to success. My coaching focuses on creating a plan to support workers to increase their wages. This involves setting up an initial meeting to discuss goals and looking at barriers to success. Then get to work on your behalf, creating your blueprint for success, which you will implement at work.
If you would like to increase your pay or negotiate your salary, contact me here.
Please do not think you can always increase your pay later. Workers who make this mistake miss opportunities and tend to remain within the same pay grade.
Your money messaging and being underpaid
Some workers remain underpaid because of negative money messaging. Having worked with many clients, I know that sometimes there is a real fear around money. Some people do not want to seem greedy for asking for more money.
But this is not the case. Your employer has not done you a favour by employing you. Instead, the opposite is true. As an employee, you are making your employer more money. Your pay rise is about what you need to see to keep you producing and motivated.
Advocating for yourself is about creating a win-win for both parties. It is a sign of maturity, not greed.
When it comes to being underpaid, ignorance is not bliss. Remaining ignorant and over-trusting of an employer is causing millions of workers to lose out. It's about arming yourself with information, creating your support team and identifying barriers that are stopping you from achieving your salary potential.
Remember, your time is not free. The US film Jerry Maguire said it best when he said, ‘show me the money’.
Until next time
Click here to read more posts from Eunice.