What is a Market-Based Salary in 2023?

What is a Market-Based Salary in 2023?

No matter which job vacancy you explore, the term "market-based salary" almost always appears. It can be frustrating not knowing exactly what this term means or why employers aren't straightforward about their offerings. This article delves into everything about the market-based salary in 2023. You'll learn how to calculate it and negotiate it effectively. Plus, we'll compare the market-based salary in 2023 to that of 2022, helping you understand precisely how much of a raise to expect this year.

Table of Contents

1. What is a market-based salary in 2023?

2. How do you calculate the market-based salary?

3. Market-based salary in 2023 versus 2022

4. Negotiating your salary

5. Frequently Asked Questions about market-based salary

What is a Market-Based Salary in 2023?

A market-based salary is the average income earned by individuals with a similar profile and in a specific position. The income level depends on various factors, including your level of education and work experience. For instance, if you're a twenty-five-year-old IT professional with one year of experience as a junior, the market-based salary is the income that individuals with precisely that profile typically earn.

How Do You Calculate the Market-Based Salary?

Understanding what a market-based salary is might not provide immediate clarity on how to calculate it. However, there's a simple way to determine this salary for people with your profile.

One useful tool for this calculation is the Salary Check by Loonwijzer. Here's how it works:

1. Visit the Loonwijzer Salary Check (https://loonwijzer.nl/salaris/salarischeck#/) .

2. Input your level of education, work experience, and job position.

3. Review the results in the table.

Loonwijzer calculates the market-based salary based on thousands of submitted salaries, making it a highly reliable benchmark. If you're uncertain about the expected salary or what to negotiate for, Loonwijzer can guide you toward the right choice.

Market-Based Salary in 2023 versus 2022

The market-based salary changes every year due to economic developments. This includes the country's economic growth, purchasing power, inflation, and the expansion or contraction of the job sector you're in.

On average, the market-based salary in 2023 is higher than that of 2022. However, this increase is not substantial, just a few euros. Here's how much employees will gain in net income in 2023 compared to 2022.

The increase in income isn't significant overall, but for those earning a double median income, there's a noticeable improvement. However, income levels can vary by sector. In finance, for instance, salaries tend to be higher, with positions like Investment Banking Analyst and Investment Analyst earning over €5000 gross per month. As an M&A analyst, the average income hovers around €4,100 gross per month, potentially exceeding €7,500 with more experience.

Negotiating Your Salary

Negotiating your salary might be daunting but is crucial. Effective negotiation can add tens or even hundreds of euros to your monthly income. However, it's essential to demonstrate your worth.

Yet, excessive hard bargaining could backfire. Some things you should avoid during salary negotiations include:

1. Negotiating hard for your income while having little experience and just starting out of school: It's important to be cautious when negotiating your salary, especially if you're fresh out of school or have limited work experience. Pushing too hard for a high salary might not be beneficial. It's more valuable to gain some experience first and gradually build up your salary.

2. Demanding a significantly above-average salary while people with a similar profile earn hundreds of euros less: It's good to aim for growth, but requesting a salary significantly higher than what's standard for your level of experience and skills might be unrealistic.

3. Not making any concessions while your employer is trying to meet you halfway: Negotiations often involve a give-and-take approach. If your employer is willing to compromise, it's important to also be open to concessions. Lack of flexibility can make negotiations challenging.

Good negotiation involves give-and-take. If you aim for a salary higher than the market-based income, you'll need a compelling argument. What makes you stand out, and what references can you provide as proof? If negotiating feels daunting but you still want a fair salary, aiming for a market-based salary during your application might be the best option. This ensures a decent income.

Before heading into a salary negotiation with a new employer, prepare by:

1. Thoroughly researching the market-based salary in your field.

2. Determining your worth based on experience and education.

3. Allowing the employer to propose an offer before presenting your expectations.

4. Being willing to negotiate but knowing your limits.

Would you like more information on becoming an expert in salary negotiations? Check out the article: "Negotiating Salary? Here's How to Go About It!" This comprehensive guide covers all the tips and tricks needed to negotiate your income effectively, explaining the above five steps in detail.

Frequently Asked Questions about Market-Based Salary

You now understand that a market-based salary is the average income of people doing the same work as you, with similar education and work experience. You also know how to negotiate your own salary like a pro. Here's a brief overview of frequently asked questions:

What is a market-based salary?

A market-based salary is the average income earned by individuals in a similar position to yours, possessing comparable education and work experience. For example, if you work in IT, hold a bachelor's degree in Computer Science, and have worked as a junior for two years, your salary aligns with others who have a similar profile.

How is a salary determined?

A salary is determined based on your level of education, work experience, and job role. Sometimes, the salary scale outlined in your collective labor agreement (CLA) may also play a role. Larger companies often offer slightly higher salaries compared to smaller ones, and there might be more opportunities for career advancement.

How do you negotiate a salary?

Looking to maximize your salary negotiation? Educate yourself thoroughly on the market-based salary within your field before starting negotiations. This way, you can easily determine your worth based on your experience and education. It's preferable for the employer to make the initial offer, giving you room to respond. It's okay to negotiate firmly, but it's crucial to know your limits.

Magnet.me x FSR Partnership

Magnet.me is an online network for students and graduates that makes it easier to find a job or internship you love. You can discover relevant vacancies based on your profile and likes, and build your professional network by connecting with companies that are interested in you. Companies send their likes and connections messages, instead of spamming cold reach outs. This results in an easy process that gets the right people in the right jobs!

You can also connect with FSR on the Magnet.me platform to stay updated on all our upcoming events. Additionally, on our Financial Career Platform, you will find career-related articles written by Magnet.me. In this way, we hope to even better prepare you for your (financial) career path.

Stay tuned for more content with regard to the partnership.

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