It’s possible that when you accept a new job offer and hand in your notice that your current employer will make a counter offer in order to incentivize you to stay.
This typically comes in the form of an increased salary and benefits package. So you might be wondering how should I handle this?
As you know, the job market today is very competitive, particularly within data science and machine learning. Companies are fighting tooth and nail with their competitors to bring in the most talented individuals out there. Don’t underestimate your worth.
Counter offers are becoming more common as companies strive to keep hold of their most valuable employees. However, in a lot of cases, the counteroffer benefits the company more than the employee.
Accepting a counteroffer can seem appealing if it means a higher salary and counter-offers do seem appealing in the short term. However, in the long run, it may not be beneficial for your career.
Approximately 70-80% of people who accept counteroffers either leave or are let go within a year. This is a statistic to keep in mind if you ever find yourself in a counter offer situation.
Why do companies make a counter offer?
Hiring new employees can be challenging and expensive. In order to replace a senior executive, it can cost a company up to 200% of annual salary. Even more in some cases.
Retaining staff is more cost effective for a company than finding new ones. It takes a lot of time to find and interview new staff and more time than most people think. This is all before the actual recruitment of a new employee, which in most cases is expensive and takes up valuable resources. However, it is the lost productivity of the previous employee that is the most costly.
Existing staff have specific skills and business understanding to carry out the job. For example, if a role requires particular niche skills, it can be troublesome to find and train these types of people. Some roles, however, like those within AI and machine learning have a candidate-led market due to a limited talent pool. This means that finding and hiring someone with relevant experience for the advertised role can be very difficult.
Employees in leadership roles have a massive impact on the business in terms of loss of productivity. Potentially affecting the productivity of multiple employees if they were to leave. A counter offer can be a way to avoid this widespread cost to a business in the short term.
Know your worth.
Although your initial reaction may make you think that your company is finally appreciating your value to the team, this is not usually the case. A counter offer is not about the business reaching out to meet your needs, this is more about meeting the needs of the company at that point in time, rather than the company reaching out to meet your needs.
When an employee decides to leave, particularly at an inconvenient time, counter offers are then deployed as a means of retention. This might be because there is a significant project in the pipeline or because several other team members have recently departed.
Although on the surface it seems by increasing your salary the company is taking a financial hit, in actual fact, they are saving money overall.
It is commonplace for companies to make a counteroffer alongside some sort of emotional leverage. Perhaps suggesting that promotion which was around the corner of the team will miss your expertise.
While these comments could be genuine, a good business that values its staff would have made you feel appreciated before you felt the push to leave. In simple terms, because you have the skills and experience for the position already, your value as a commodity is now higher.
Think about your career in the long term.
There are some important factors to take into account when you consider accepting a counteroffer:
1) Broken trust
Once you have made it clear that you don’t want to be a part of the team anymore and you’re moving on, the effect that has in regards to the trust of the relationship is irreversible. As a result, the relationship with your employer has also changed the moment you hand in your notice. This has the potential to impact any future promotions, pay rises or projects you are given in the future.
2) It’s not all about benefits
Remember why you started looking for a new job in the first place? Was it really all about the money? If so then great, accept the counteroffer. However, there is more to job satisfaction than salary. Are you learning enough in your current role? Think of your personal development.
3) Too little, too late.
If you expressed all your concerns that are addressed in the counter offer and they were not dealt with in an effective and timely manner, then you can expect the same treatment in the future. Basically, you are more than likely going to have these same problems again down the line.
4) Job Security
Your job security moving into the future will drastically decrease simply because of your lack of commitment in the past. If redundancies do happen then your name might be one of those at the top of the list. Equally, it is possible that your company is just keeping you on in the meantime while they find a replacement.
Consider all these factors carefully before making a decision about the next step in your career.
Appreciate new opportunities.
Will staying where you are, offer you the same long-term personal career development as moving to a new role? Think about the opportunities to grow that you may have with your new employer. Can you gain these same opportunities with your current employer? Again, job satisfaction is about more than money.
Counter offers are not beneficial for your career and you are more than definitely better off taking on a new challenge that can offer you the progression you are looking for.