Counter Offers - they're back!

With job market conditions rapidly catching up with pre-recession levels of demand, we’ve seen a steady increase in the number of counter offers being used as a means to try to retain staff who’ve secured an offer elsewhere and tendered their notice.

As demand for staff rises, availability drops, and with employers focused on making the most of the economic recovery, retaining experienced staff is high on the agenda.

Good news for employees, not so good news for recruiters who, having invested a significant amount of time managing the process to this stage, can then experience last minute drop-outs from jobseekers who are persuaded to stay. A quick search online will throw up dozens of blogs and articles about counter offers, usually written by recruiters, quoting unsubstantiated statistics on the number of people who end up leaving their employer six to nine months after accepting an offer (usually between 80-95% - take your pick or, better still, read Mitch Sullivan's investigative blog on this subject). The overriding message being: don’t do it, take MY job!

There may well be a high proportion of individuals in this situation who do ultimately decide to move on after promises have been broken further down the line, but even so, unless there is a history from the individuals’ specific employer/line manager, I’m not sure this is relevant enough information to be basing important career decisions on.

For me, when a jobseeker decides to accept a counter offer, what this really tells me is that:

a) the other opportunity wasn’t good enough in the first place, or 

b) the candidate never really wanted to leave their employer, they just wanted better reward and commitment from them. Maybe they’ve discussed this with their manager and it’s fallen on deaf ears, or maybe they just feel this is the best way to force their hand?

I do however believe there is some truth in the often-stated claim that going through a counter offer process breaks a level of trust with an employer, especially if the employee had not raised any dissatisfaction previously. I also believe financial boosts alone are short term solutions that will often reoccur when the employees next salary review takes in to account the unplanned increase that’s already taken place.

From the employers perspective it’s also far from ideal. How will this affect the employees trust and buy-in to the business when it’s had to get to this stage? You can be sure at least one of their close colleagues will be aware of the situation and may now decide to go through a similar process themselves to increase their financial position.

In an ideal world, counter offers would never need to happen. Employers would regularly assess the ability, value and career aspirations of their staff and employees would have the confidence and opportunity to discuss any issues and frustrations openly. Jobseekers would only reach offer stage for positions they know they would be willing to leave their current employer for, and then, and only then, recruiters might then stop quoting those tired old statistics.