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What is a sign-on bonus?
How much is a signing bonus?
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How much is a signing bonus in 2022?
Sep 13, 2022 · Signing bonuses are usually lump sums of money offered to potential hires to entice them to join a company. The average value of the signing bonus will depend on the industry, but it can range anywhere from a few hundred or thousand dollars to upwards of $50,000.
Jan 23, 2024 · For managers and executives, the average sign-on bonus lands somewhere between $10,000 and $50,000 or more. Sign-on bonuses of less than $5,000 are more common for individual...
- Overview
- What is a sign-on bonus?
- Why do companies offer sign-on bonuses?
- Industries with sign-on bonuses
- How to negotiate a sign-on bonus
When you're negotiating a job offer, an employer may offer you a sign-on bonus. This financial reward may encourage you to accept the job offer and help you start working in a more advantageous financial position. Understanding what this bonus is can help you negotiate it effectively and ensure you optimize your offer.In this article, we take a loo...
A sign-on bonus is a monetary reward that an employer offers to an employee when the employee begins a new job. A sign-on bonus may come in the form of a single payment, multiple payments over a specified period or stock options. Once the employer issues the negotiated payment for your sign-on bonus, they don't make any more bonus payments.Because ...
To acquire your skills
An employer may be more likely to offer you a sign-on bonus if you have desirable skills. They may be willing to reward you with a financial sum if you have beneficial soft or hard skills.For example, if you have an outgoing personality and great customer service skills, they may want to offer you a sign-on bonus so they can easily fill an open customer service representative position with a high-quality candidate.An employer may also consider the hard skills you have. If you're applying for a software developer position, they may offer you a sign-on bonus if you have ample experience with a particular coding program. If many companies demand the skills you have, you may be more likely to get a sign-on bonus as an enticement to work for a hiring organization.Related: Hard Skills vs. Soft Skills: What's the Difference?
To compensate you for a lower salary
A sign-on bonus is a form of compensation for a new employee in addition to their established salary. Employers might need to maintain salary equity within the company, which might cause a lower salary than you requested. If an employer can't offer you the salary you want, they may offer you a sign-on bonus to make up for a lower-than-expected salary.Related: How To Respond to a Low Salary Offer (With Helpful Tips)
To make up for the benefits you'd have to forgo
If you're an expert in your industry, you may leave behind a potential bonus or other benefits when transitioning from one company to another. When this is the case, your prospective employer may offer you a sign-on bonus to make up for what you would be leaving behind.Related: What Are Workplace Benefits? (18 Examples of Benefits)
Some industries are more prone to offer starting bonuses because positions require in-demand skills and expertise. You might expect sign-on bonuses in these fields:
•Health care
•Information technology (IT)
•Commercial transportation
•Law
•Marketing
1. Understand your skill set and the value you can offer a company
Gain a thorough understanding of how valuable your skills are for the company. Make sure what you do is in demand and that your prospective employer is showing real interest in you.Related: How Much Am I Worth? (Steps for Determining a Fair Salary)
2. Provide logical reasons for a higher sign-on bonus
While you can highlight your skills to show that you deserve a higher sign-on bonus, you may provide other logical reasons to justify a higher one-time payment. For example, you may explain that you have a long-distance daily commute for which the company doesn't provide gas mileage reimbursement.You may also explain that you need minimal training, so you can save the company money in this sense. Still, you may also explain that you would benefit from a higher sign-on bonus because the hiring organization isn't offering you comprehensive health insurance coverage.Related: 25 Types of Employee Benefits To Look For in a New Job
3. Understand the long-term effects of a sign-on bonus
Determine if the sign-on bonus makes financial sense in the long term. Let's say an employer offers you a substantial sum for a starting bonus. You might want to agree to it because of the initial reward, but you can carefully consider its effects first. Ensure your regular salary is suitable for your needs once your employer pays out the sign-on bonus in full.Related: What Is a Salary Range and How Do Employers Use It?
- Jessica Hinkle
Jan 30, 2024 · Signing bonuses are most typically awarded to top executives, upper management, middle management, and professional staff, World at Work learned. For managers and executives, signing bonuses typically ranged from $10,000 to more than $50,000. For clerical and technical workers, signing bonuses tended to be less than $5,000.
Feb 23, 2024 · The signing bonus amount is relative to the industry and position you are applying for. Recent studies have shown that managers and executives may receive between $10,000 and $50,000, while more technical workers tend to receive less than $5,000.
May 2, 2023 · Bonuses range in value, however a typical signing bonus may be as much as 10% or more of the potential hire’s first-year base pay. If you’re interested in a signing bonus, you’ll have to integrate this into your negotiations when you’re discussing your contract/offer with your future employer.
Sep 13, 2022 · By Lora Shinn. Updated on September 13, 2022. Fact checked by Taylor Tompkins. In This Article. Why Employers Offer Signing Bonuses. When To Ask for a Signing Bonus. Tips for Negotiating a Signing Bonus. What To Watch Out for With Signing Bonuses. Frequently Asked Questions (FAQs) Photo: A G Holesch / Getty Images.
