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Here is why the recruiter asks, “What is your salary expectation?”

There are two permanent questions in any interview, across industries.

One with which interview starts and the one which closes interview.

You know the first one, right?

Let us talk about the second question here : “What is your salary expectations?”

Sometimes one would wonder, whether “they” even mean it, usually it is there in the JD, what they could afford, but even then?

It could be a routine check-point , to put on the record, candidate’s expectation(s), in her own words.

It’s like getting confirmation of their self-worth, after ‘they’ have already made decision.

Companies have bands and grades, they have advertised the CTC and they ‘demand’ to know prior CTC; yet they will ask the ‘E’ question?

While there could be a lot of reasons for why ‘they’ do this, but Psychology has an explanation here.

The smart recruiters are employing two techniques here, and some do inadvertently.

The first one is “Anchoring Bias”, which means humans tend to benchmark, everything from the first figure proposed. So anyone who proposes a figure first, has set the benchmark and thus the tone of negotiations. Unlike in “first-mover advantage” principle, the HR person has an edge here, even though employee states her expectations first.

Second technique is called, “Shrinking Pie Negotiations”, where there is a cost of delay involved, arguing over a negotiation. Since the pie is shrinking with time (like a one month delay could cost a month’s salary), the candidate would rather acept the lower figure prosed by HR.

So while a candidate would rather have wanted a 30% raise on her last salary, she might settle for 20.

Moral of the story: Don’t look for a job, when you have to look for one. Start searching, well in advance, when no one can pressure you with second technique.