“Should I Stay or Should I Go …?”
Now that’s a great song by punk band The Clash – released over 40 years ago!
You may think that’s a long time, but the curse of Counteroffers has been around for longer, albeit in various forms, but in today’s competitive job market it is so prevalent.
Small talent pools, limited hiring budgets, fear of disrupting the workflow and team mix are all “drivers” for Employers to attempt to retain staff. The upside for the Employer is they may avoid the points mentioned, but equally they must deliver on the “promises” made in the counteroffer – that could be more money, defined career path, promotion or better job responsibilities. This could easily have a ripple effect on the existing team – “Let’s resign and we can get more money”; salary relativities amongst the staff get very distorted; people get resentful that they are not rewarded by loyalty and positive performance, but by their Employer just wanting to solve the problem and that refilling the role might be hard work.
In my 30 years’ experience within Executive Recruitment the main reasons people look for a new role are:
- Seeking a fresh challenge.
- Seeking a larger organisation with more opportunity/seeking a smaller group to make an impact and get closer to the operations.
- Work/life balance, not working ridiculous hours with no end in sight and concern of “burnout”.
- Healthier, collaborative and open work environment.
- More money.
Money is NOT the most common reason people leave; but, with counteroffers, the easiest card for Employers to play is giving more money. Although the Employee may be flattered with increase in money, it doesn’t necessarily resolve the issues that led to them resigning in the first place! Also, the Employee should ask themselves why has it taken the threat of resignation to prompt this appreciation of your worth.
Let’s look at some statistics that were recently taken in the UK, which easily apply to Australia:
- Over 70% of candidates that accept a counteroffer from their Employer leave within 6 months. Again, the Employer hasn’t delivered on their promises to the staff member. This figure rises to 90% who leave after 12 months …. this reinforces the view that “throwing money around” is not the solution and reinforces the fact that the Employer needs to address the underlying issues quickly and effectively. This will produce a work environment that is more open, collaborative and attractive for people to stay and enhance the brand as an “Employer of Choice”.
- Over 45% of candidates that resign will be counter-offered. This figure is higher within some “talent short” industries, ie Legal, Chartered, IT.
- Around 35% of Employers do not make counteroffers. This is generally due to their HR policy, or they feel the Employee is “dispensable” and can be easily replaced.
Yes, totally understand that some counteroffers do work out for both parties; but, as indicated above, there are obstacles.
Employers should be proactive and listen/react to the market and employee views. Instil an open and attractive work environment that employees are proud to be associated with – everybody benefits!
If you would like to discuss how to handle a counteroffer or your next career move, please reach out to Graham Hollebon or a member of our specialist recruitment team today.
Or you can visit Graham’s page HERE.
