Comparing Job Offers
I’m a Libra, so I’m no stranger to indecisiveness (cue eye roll from the astrology-haters). Big decisions such as which job offer to accept can be daunting. But if we just approach this like engineers, it’s really nothing more than an alternatives analysis. We can do this.
Let’s start with the quantitative. Start by creating a spreadsheet to come up with a number for each offer that includes your salary, costs, and benefits. That way you can compare apples to apples. Here’s a breakdown of the inputs:
(+) Base salary: Self explanatory.
(-) Health Insurance: How much will they be taking out of your paycheck for health insurance.
(-) Health Costs: On average, how often do you go to the doctor. Multiply that by the expected copay and compare to the deductible. If you need specific medication, check the coverage.
(-) Commute Cost: How much does it cost to get to work and home each work day? Consider the cost of train tickets, tolls, parking, gas, wear and tear on your vehicle, etc. Note that if you don’t want to get too caught up in vehicle costs, you can use the government mileage rate.
(-) Commute Time: Your time commuting should also be considered. Choose a rate for your time that captures your value as well as how much you care about time. I used a rate of $25/hour for driving and $20/hour for public transportation. Note that I used a lower rate for public transportation, because I would be free to do other things on the train such as sleep, read, knit, blog, work, etc.
(+) Vacation Offset: For every day of vacation, you earn time and money back. Use your time rate for the work day (this can be a different rate than your commute, if you value this time differently) plus your commute time and cost.
(+) Sick Offset: Similarly to the vacation offset, you earn time and money back for sick time. This is a little different, as you usually need to be “sick” to take these days. But estimate how many sick days you think you’re going to take out of the available and do the same as the vacation offset.
(+) Retirement: If you get retirement benefits, like matching, include the value of the additional cash you’ll receive. You can make a note about vesting schedules in the spreadsheet as well. Or you can assign values to the vesting schedules or do a cost analysis over time, if you feel that would be worth the time.
(-) Taxes: If your salaries are in different tax brackets, you may want to take taxes into consideration. Or if you’re considering jobs in two different states, you may want to consider the additional taxes you may have to pay in one state vs the other. If you’re not a tax expert, you can just google it and find the best estimates you can.
(+/-) Other: Add any other considerations that might be offered or important to you such as gym memberships, ESOP, work from home options, childcare benefits, HSAs/FSAs, dental insurance, vision insurance, tuition reimbursement, etc.
Once you input everything in your spreadsheet, you can easily compare the two job offers in terms of quantifiable value.
Now let’s move on to the qualitative. It’s time to make a standard pros and cons list. Make considerations to anything that’s important to you, which can include:
company culture
the people
your direct supervisor
size of projects
types of projects
location (nearby restaurants, proximity to parking/train station)
office (decor, desk, lighting, air quality, etc.)
technology
commute type (transfers, traffic direction, etc.)
opportunity for growth
vacation earning potential
diversity
There are plenty of articles about factors you should consider when comparing job offers. Use these as inspiration in creating your pro cons list. Highlight any items that are really important to you so that you can visually see where each offer stands.
Then, consider all the data together. You can see which company “wins” in the quantitative or qualitative categories and make an informed decision. Sometimes even if Job A is paying you $40,000 more and giving you 10 more vacation days, your gut telling you Job B is something worth investing in. But by collecting this data, at least you’re understanding the risk and what you might be giving up. On the other side, if Job A is asking you to sell your soul but that paycheck is calling your name… You can at least know how much your selling your soul for. (Good to know how much that costs, right?)
Finally, negotiate. There’s always room for you to ask for something you want. I’m not suggesting you pit your offers against each other. But if you really want to accept Job B, but only if they can offer you a work from home once a week, ask if that’s possible. You may not get it, but it doesn’t hurt to ask for what you want. You’re in charge of your own happiness, go after it!
And please don’t sign any non-compete agreements that restrict your freedom with getting a new job. That way, if you regret your decision, you can always just quit and find a new job. (Always have an exit strategy.)
Good luck with your decision!