SOMETIMES the most challenging aspect of applying for a new job isn't the inane questions put to us in the endless rounds of interviews. I have no idea where I'll be in five years and keep hoping for a Lotto win.

Nor is it the thought of another creative regrouping of our talents in the lengthy and ever-altering CV.

Crucial as it is to have a great CV and a huge dollop of self-serving bias when going for a new job, and important as are the impressive array of 'competencies' we unleash at interview, the most vital yet unnerving thing we do when applying for a new job is giving even a glimmer of the ball park of the bill we're going to put before the new employer for our coveted services.

The consequence of each grin and grimace we make at interview can be exhaustively analysed afterwards but the poker face we preserve - and the better we are at bluffing - when it comes to naming our price can be more crucial, and mean more for our future fulfilment and family fortunes.

So, when they say 'please send covering letter, citing your salary expectations', just send the covering letter.

Then think carefully.

All human activity is a mix of chance and skill, and so it is with the salary we get. Think of the people you know who seem to earn huge salaries for very little achievement. Think of the people who seem to earn very small rewards for huge achievements.

Think of what impresses you and of how impressions are managed in society. Then add 20 grand to your bill, buy a better suit and prepare for the Q&A.

Employee salary expectations are a vital influencer of how CVs will be interpreted; we all really believe we're 'worth it', but not everyone on the other side of the recruiting divide agrees any more, and for very good, reliable and scientifically verifiable reasons.

People's perception of their own worth can be based more on what brand of baby food their mummies fed them, the number of designer suits in their wardrobe and their social group than on the value they add to organisational life.

Pay expectations can be less about performance than a propensity for profit-making. Even though it's true that high performers earn more, the corollary is not as rock-solid a premise, but it's often too late once the new employee is in situ to downgrade their pay, and too late if some recent fantastic recruitee is snapped up by the opposition for Euro20,000 more than they asked you for, even though you realised too late they were 'worth it'.

Paying people based on their own pay expectations is flawed. Salaries should be clearly linked to measurables and outcomes, rather than to the maintenance of social hierarchies and reinforced socio-cultural assessments of merit.

If only you had indicated at your last application that you were up there with the HEE (High Expectation Earners), you might well now be enjoying holidays in five-star hotels, have never heard of Expedia and not care a jot if SSIAs ever mature, instead of counting down the days.

Applying for a new position is one time when, for employees, being realistic, reasonable or rational are not advised and instead, ego-maniacal self-promotion is the best bet if you are asked to nominate your expected salary. For employers, being realistic, reasonable and rational? This is the time.

The attractions of money, other than to provide goods and services we need or to feed our instinct to hoard, are to create social differentiation.

According to psychologist Dorothy Rowe in The Real Meaning of Money it's not just compensation for effort or long hours in the office that makes us rank ourselves up there with the 5% of top earners or lingering with the 'average industrial wage' receivers.

Often those with high salary expectations have more in common with each other than they have with those who really get things done, but the expectation that their worth soars the dizzy heights of the multiple zeros means those making judgements about the CVs of these people infer a correspondent magic with matters of profit, whereas the appreciation of mathematics may go no further than the putting together of the fantastic salary expected.

Salary expectations reveal statusseeking more than they reveal some effort-reward or performance-related pay baloney, according to research jointly conducted by MIT and Yale scientists in the late 1980s. This is especially true with regard to women, who may well be inadvertently making employers privy to a skewed and under-rated self-worth and allowing them to pay less for similar work.

Vocational self-esteem through gendered lenses means that many groups of women studied from the 1980s and through the '90s expected lower salaries than their male counterparts for the same work. And males had different (and more correct) beliefs about the effects of their higher expected salaries than women had ('Ask and You Shall Receive?' Human Relations, 2003). Women didn't want to appear too demanding, basically and men didn't want to appear not demanding enough. Hm. Now where have we noted that before?

The phenomenon is referred to as 'the paradox of the contented female', which most of us may have presumed referred to women in relationships.

And it's not because women enjoy the social events working brings them.

Nor is it attributable to the fact that women expect to do less work and therefore earn less, but thanks to Adam and keep the tongue in the cheek.

Similarly, those from disadvantaged groups or minority populations compare themselves to their group and expect to be rewarded accordingly, which explains the fact that they are 'happier' with less reward for the same effort, as they discount themselves due to the social advantage of those they see as holding stronger hands than they have, even if they have the same qualifications and experience.

Presuming we're not all following the Aristotelian principal of seeking the good life and not the money, recruiters know that one of the prime attractions of any position is the money it brings. But indicating your expected salary can work against employers if they misinterpret monetary ambition for achievement.

Remember that Johnny from the biggest gaff in D4 with the loudest voice and most the self-assurance only believes he's worth a quarter mill a year because them's the cues he's been getting since pre-school.

So, employee, be canny. Think big.

And employer, beware. Think measurable.

Patricia Murray is an organisational and work psychologist pmurray@tribune. ie