The Great Resignation is seeing businesses across the UK losing staff in record numbers, fuelling the Great Retention. As the mass movement of talent shows no sign of slowing, employers and HRs are clutching at straws to retain their people. Figures show the costs to replace an employee can be up to 200 per cent of the former employee’s salary – and with the energy, fuel, and living costs rising, keeping the purse strings pulled tight will be a key priority for many.
An age-old tactic being used by employers are counteroffers and can often leave candidates and employees pondering over what to do when they’re presented with one. Do you give in to your current employer’s offer to stay where you currently are, or throw caution to the wind and jump into unchartered waters?
Depending on the situation, the implications (or benefits) of a counteroffer can vary. It can have a significant impact on your career, and potentially, reputation. Harvard Business Review conducted a survey that found nearly 40 per cent of senior executives and HR leaders agreed a counteroffer can adversely affect one’s career. On the flip side, however, 80 per cent of HR leaders said it is ‘sometimes’ acceptable to accept one – depending on the situation, of course.
Regardless, Dominic Wade, Co-Founder of specialist HR recruitment firm, Wade Macdonald, says accepting a counteroffer from your current employer can be damaging to one’s career.
Mentally checked out
If an employee has already considered another employer/job, then chances are they aren’t at their happiest and most fulfilled in the current role. Employers know that people don’t leave a role or company they are genuinely happy in.
Therefore, it’s crucial to objectively consider why eyes wandered in the first place. Many ‘issues’ aren’t exclusive to one company, so talent may well find themselves battling with the same issues at a new company.
However, some circumstances do call for change. It’s important not to settle for a less than satisfactory job when an opportunity for a better one presents itself.
Companies are run fundamentally on relationships, therefore looking across the fence for greener grass may damage employee-employer relationships.
Research has shown that up to 80 per cent of those who accept counteroffers end up leaving their current employer within six months. Other studies have shown that job security decreases after accepting a counteroffer – if sudden redundancies need to be made, it’s clear who will be first in line.
At the initial interview or job acceptance stage, candidates often envision the new role, company, commute, and daily routine. Clients may have been researched, Glass Door reviews researched, and potential new colleagues’ profiles peeked at.
By taking a counteroffer, these unopened doors become a ‘What if?’ and inevitably lead to one pondering on what opportunities the new job would have offered and could lead to feelings of resentment and low motivation.
As the saying goes, nothing grows in a comfort zone.
A balanced argument
While some aspects of a new package, such as pay, may favour the counteroffer, it is vital that employees carefully assess the strength of the offer and weigh up options objectively in terms of career progression and fulfilment.
Consider long-term goals and salary ambitions and make the decision accordingly. A current role may be in the ideal sector and area, so staying will be more beneficial in terms of gaining experience and climbing the ladder. However, a new and unknown opportunity could be a game changer.