The Rise of the CounterofferAdmin
A wise recruiter said it best when she said “the war for talent is over and talent won.” Finding and attracting top talent is harder than ever. The latest BLS numbers indicate that the unemployment rate is holding steady at 4.1% and projected to decline to 3.5% or lower by mid-year. With nearly 6 million open jobs in the U.S., it is clear that companies across many industries are experiencing growth and are in need of talent. Counteroffers are on the rise as it becomes increasingly more critical for organizations to retain their employees, particularly those top performers who directly affect revenue and productivity. We are seeing counteroffers of 25% or more by employers in our local market to keep their best employees. How do you counteract the counteroffer and make sure the best employees choose to work for you?
Probably the most important step you can take to combat any counteroffer your candidate may receive is to have a candid conversation about it. Be sure to ask the candidate why they want to make a change. While it sounds obvious, this question is often omitted by interviewers during initial phone screens and interviews. You need this information to gain insight into a candidate’s motivation for leaving their job and to their level of commitment to leaving their current job. Asking he or she to talk openly about what they are looking for, and what they are not getting from their current employer will give you an idea of how likely they are to accept a counteroffer. If the primary reason for leaving a job is monetary, they are more likely to accept a counteroffer for an increase in pay. If the motivation is career advancement, they would probably consider staying at their current company for a title modification. Ask them directly if they would consider a counteroffer from their current employer, should one be offered. If the answer is yes, we would recommend passing on that candidate, as they are most likely using your job offer as a bargaining chip. An employee who is dissatisfied with management, a long commute or an unhealthy workplace culture will be more likely to commit to an organization that will provide alternatives to these issues. Once you know a person’s reasons for leaving, you should subtly remind them of these things throughout the hiring process. This will help them mentally prepare for the counteroffer and further affirm why they were entertaining your offer in the first place. You can also acquaint them with an often referenced statistic that indicates that 9 out of 10 people who accept counteroffers have left their employment within 6 months. This could be because the employer decided to find a replacement, or because the employee realized that the initial reasons for wanting to leave haven’t changed.
Just because you were able to hire the candidate of your choice does not mean you have avoided the counteroffer. The new trend is the counteroffer that comes several months after someone leaves a company. If a new hire does not establish a connection to the culture of your company and to the work itself, they will be an easier target for the employer who is desperate to win them back. In a BambooHR survey of over 1,000 workers, 31% reported having quit a job within the first 6 months. One of the top reasons given for the early departure was a poor onboarding experience. Providing a positive onboarding experience increases the likelihood that a new hire will feel a sense of commitment to your organization and be less likely to leave. The benefits of improving employee onboarding are good for the company as well. Studies show that a favorable onboarding experience also leads to greater employee retention and improved job performance.
Give them your best offer
A recent Bradley Staffing Group survey revealed that 75% of candidates would require no less than a $5,000 annual pay increase to accept another position. In the same survey, our respondents ranked compensation and benefits as the most common contributor to job satisfaction. Undervaluing a position will consistently cause you to lose top candidates in a competitive market. If you want to secure the kind of employees that are going to move the needle in your business, you should be prepared to make a competitive offer from the start based on market value and your understanding of the candidate’s skills and experience. Present a competitive offer with enthusiasm and explain why you believe that candidate is perfect fit for your team. You will increase the appeal of your organization and help ensure that the most qualified candidates are eager to work for you. Paying an employee well is far less expensive than the cost of turnover, which is often estimated to be 100% to 300% of the base salary of the employee, depending on their wage and role in the company.
Evaluate your Hiring Process
A long hiring process is one of the main reasons businesses lose top candidates. The latest survey results from SHRM indicate that the average overall time to fill a position is 42 days. Your hiring process is a candidate’s introduction to your company. If their first impression is that your process is unusually long or cumbersome, they may question what it would be like to work for you, and think twice about coming on board. A common complaint among candidates is related to the lack of feedback and communication during the course of the hiring process. Consideration of the candidate experience means communicating with them throughout the process. From the time a resume is submitted to the time an offer is extended, you have an opportunity to demonstrate that you have a new hire’s best interests in mind. In our experience, the most sought-after candidates in our local market have multiple interviews and offers simultaneously. If your communication and feedback doesn’t come in a timely fashion, you could lose the most desired candidates to other organizations or to counteroffers from current employers. Through social media, candidates are able to review the hiring processes of many companies. Your organization may earn a reputation for having a long hiring process, which could result in the fewer high-quality applicants, and candidate drop off.
Give an Accurate Picture of the Job
Many employees will consider accepting a counteroffer if a job turns out to be different than what was described to them. We often hear complaints from candidates about hiring managers who “oversell” the job to fill the position more quickly. A new hire will quickly begin to lose faith and trust in an organization if he or she believes that they were misled about the nature of a job. Providing a detailed description of the job at the beginning of the interview, and keeping an open dialogue about the requirements and responsibilities will help to avoid misunderstandings that could cause an employee to quit. This kind of bait and switch not only makes candidates likely to retreat to a former employer, it can also be very damaging to your company reputation if the candidate chooses to post about their experience on employer review sites or social media.
As an employer, you want to hire the kind of candidates that add value to your organization, and are coveted in your industry. A candidate receiving a counteroffer may seem like a good sign, and arguably it is. As employers become more determined in their attempts to keep their best employees, the odds that a candidate you are interested in will receive a counteroffer are much greater. Your ability to engage candidates and establish a connection will directly affect your ability to hire and retain them.
Bradley Staffing Group is a full-service staffing firm based in Wayne, PA. We are committed to matching A-level talent with best-in-class businesses. Our knowledgeable and well-trained staff brings a combined 70+ years of staffing experience to our clients and candidates alike. http://useful-sock.flywheelsites.com/employers/