I'm at a younger stage in my career (25), and at least in my experience, I've always had to find another offer at another company to get a large salary increase. I've been "promoted" within the company before, but that only came with a 3% raise. Just curious what the experience is for more senior engineers out there, are there still tech companies who give substantial raises with promotions?
I'm almost 50, and have never gotten a substantial raise without moving to a new company. On the contrary, once you are in, there is a lock on your position, especially in larger companies, where you have a specific salary range your role falls in. Raises not only try to stay within the range, they are smaller as you get closer to the top of the range. A promotion bumps you up to the next range, but that is incremental improvement. You have to leave to throw that all out and reset the numbers.
Also, 3% is a mediocre raise just for year-over-year cost of living increases. Getting a raise that small with a promotion is a slap in the face.
Of if you live anywhere besides the middle of nowhere. Inflation isn't uniform across all locations, if you live in say SF and your rent goes up 15-20%, it's likely your spending power went down by more than 3%.
"... the absolute least they calculate will keep you working hard."
I'm not sure it even keeps people working hard. Its discouraged me from working hard, especially after filling roles above my grade for a couple years.
When the company does the bare minimum and employees realize it, they do the bare minimum for the company.
If you're in OP's position (25 years old), don't react that way. Instead, react by moving.
Why? Because if you're filling roles above your grade, you're a perfect candidate for stepping up your grade as you move. That's how you get a big bump in pay. But if you're doing the bare minimum, you're a much less attractive candidate for a higher grade position. And that matters a lot for a person who's 25, because that big bump in pay sets a floor for your pay for the rest of your career.
If you're 50, doing the bare minimum doesn't cost you as much money over the whole of your career. (It can still corrode your soul, but that's not the issue we're talking about here.)
I was 25 at that time. The tech was obscure, so I didn't have the option to move. If moving was an option, then I would have taken it. Instead I'm in my 30s, burnt out, doing the minimum (sort of), and still a midlevel.
At 25, you have the option to move (that is, change companies) even if you worked on obscure tech. At 25, you can find someone who will take you in that situation (though it may take longer than finding someone who wants the current hotness).
Not possible for me. I have a family to support and they have recently developed costly medical issues. Not to mention I don't make all that much (under $100k), so most of my income now goes to expenses (area is moderately expensive even when trying to live cheaply).
Thanks. I honestly think this is the peak though. But that's ok. There are banter people in the world that would love to have a similar situation to mine vs the one they may be in.
I was almost 30 when I started in tech. I'm not in your commonly discussed SV tech scene, I live in flyover country and work remotely for a giant non-tech company. But I got to a point where I was absolutely desperate for any decently paying work. After doing graphic design for a few years (I studied art), I realized that was never going to pay. I did carpentry, construction, labor, painting, literal ditch digging, sign making, and used car sales. Somewhere in there I was a US Marine and went to war. Eventually I stumbled into a QA job at a small company and learned Python.
All this to say, now I'm well into six figures. I've work six crappy tech jobs, really bad ones. I've had one decent one and now, one really good one. I had to fight really hard to get where I am now. I mean this to be encouraging, it can be done, you can do it.
My advice? You can check out at a job, but never check out on yourself. At every crappy job I've been at, there was opportunity for me to learn something new. Job 1, I learned Python and built test frameworks. Job 2, I learned VueJS. Job 3 I learned how to build complete software projects and deliver them. Job 4, I combined development skills with cloud migration, dealt with tons of nasty legacy code, and was able to deliver major improvements to existing systems. And so forth. Also to get better jobs, I've put in hundreds of resumes. One job literally took me 200 applications to get.
TLDR I hope it's not unwelcome advice but I hate to see people give up.
I've been a dev for almost 25 years, and the biggest raise I've ever had in a job was ~10%. There might be companies that give more substantial increases with promotions but I've certainly never heard of it happening. For comparison, the biggest raise I've had by moving company was 51%.
I've found that being a bastard in salary negotiations (pushing, not backing down, willing to walk) is the very best way to get promoted, and it should almost always be with a new company. Your existing company knows what you're being paid, and that's hobbling. You need asymmetric leverage. No one needs to know your salary. They should see how you value yourself in the salary negotiation. Take risks. Pays off. You do have to perform, so don't push so hard that you can't do the work. I suppose that goes without saying, but some people forget. I forgot once. Ended up surrounded by PhD statisticians that ate my lunch. Fired 3 months later. Was still paid ridiculously, but was also ego-bruising.
You can practice this with headhunters. Push the numbers. Try double your current number. You'd be surprised some of the numbers you can pull out of them in certain "must have now" situations.
It's not anything nefarious, just the natural blind spots of human reasoning.
Titles are cheap. Your existing employer will always want to hand you more work, but not more money. If you are handling the work well, then the pain of not having that role filled is only a memory. Your future employer has an acute problem to solve and is already primed to spend money to solve it. The net result is that (current employer) is much more likely to increase your responsibilities/scope/title. While (future employer) will pay you.
There are absolutely employers who will give significant raises to existing employees, but they are rare.
10 years experience, I've received two 20% raises. If you're a high performer and have a boss willing to go to bat, it's not impossible. But it's much easier to get larger raises when moving jobs, yes.
Yes, these things happen... sometimes, as anything in the universe.
I've been promoted to a leading position after renegotiating my contract and it came with a 120% raise. You probably guessed it right - I was heavily underpaid at first. A teammate of mine earned around 60% more than me and our lead over 100%. When I finally found it out I was devastated. It happend for a couple of years. Sounds stupid? Yeah, it was. I was totally unaware of how much I should be asking for in the first place and never cared to talk about the compensation with the other guys. The team being 100% remote and spread across different countries didn't help too.
What would you do in my place? I wanted to quit, but I decided to negotiate an "impossible" raise first as I had nothing to lose anyway. It worked out and I stayed until now.
This is why I think that companies should make salaries public. Compensation negotiation is not a skill needed for performance of a job, and hiring managers will have more experience than the candidate.
Be fair and don’t worry about “the truth coming out”
That's the point man! Don't be naive. The company is not your friend it pays you as little as possible. There's no incentive for a company to pay you more than it needs to.
Once my boss bragged to me about paying one of our European contractors "Chinese slave wages." That took the wind out of my sails at that job and my boss became an enemy. I didn't last long at that company after hearing that.
~10% is more what I've seen. The biggest gain came from actually putting effort into getting lots of offers and negotiating well. This lead to an offer that was 2.75x my pay at the time. I ended up taking one that was lower (a mere 2.25x), but after stock growth, refreshers, and a base pay increase (without a promotion) that has gone up to 4x.
A 3% increase for an actual promotion is insulting. You're probably getting hosed already and could get a step function increase if you looked elsewhere and interviewed / negotiated properly. If you decide to do this, let me know, and I can give you some advice.
I've been at this for 15 years and most of my large jumps in salary have been either from job changes or counter offers when I was about to switch jobs. A couple things to keep in mind though:
1. It depends on the company but there is more to compensation than just the salary number. Often promotions will also include changes to bonus amounts (so different levels will have different target bonus %) and equity grants. From the business side it is all "comp" so they can have a different view of total compensation than you do if you are just looking at the salary.
2. If you like your job but feel you are underpaid there is nothing wrong with just asking for a raise. If they want to keep you around then they will usually accommodate you and if they don't want to keep you around then you should start looking for a new job anyway. But you have to ask. For obvious reasons companies want you to think that salary is non-negotiable, but EVERYTHING is negotiable and if they can make it happen IF they want to (or need to).
In my first job had multiple promotions varying from 5% to 50%. The lower ones (5% ~ 10%) were given proactively by my employer and for the bigger one (50%) I've ended up changing position inside the company, after asking for a bigger raise.
I agree with others that it's way more easy to have a substantial increase moving jobs.
Almost 10 years in. One 10% promotion. The new policy at my company is set at 7% raise for promotions.
The funny thing is, they unofficially expect a 13% increase in working hours for that 7% raise, which actually turns out to be a rate cut to fill a role with more responsibilities and expectations.
Finding a new job takes a lot of energy. People give you raises to prevent you from being bitter enough to spend that energy.
They also know that regardless of what they pay you, you will eventually quit anyways (unless they start paying you in the top 10% of the field, but then, what's in it for them at that point).
So no, 30-40% salary raises do not exist. At the executive level they sorta do, in the form of options and bonuses.
I was working at a small company, I was elevated from a developer to a manger of the development team (there were 4 of us). For this I was raised from $80k to $85k, so a 5k higher salary per year. Still, the real big raises have all come by grinding on skill development and finding new jobs.
As a young guy, the best and fastest way to get raise is to jump between companies.
Sticking within the single company will get you into the hamster wheel of promises, policies, processes and procedures with not much of a monetary outcome.
Once you get the offer from next company - put it on your boss desk to beat.
I couldn't find it. But there was an article or study not too long ago. That said over the course of a career. That you'll do so much better if you keep switching jobs. A really big difference in total earnings.
I am in a similar position to you, 24 years old, and am in my first role after the completion of my bachelor's in computer science. I was just promoted this week for a 28% raise within the same company.
Also, 3% is a mediocre raise just for year-over-year cost of living increases. Getting a raise that small with a promotion is a slap in the face.