Let's paint a pretty picture: After some searching, you have been interviewing for jobs and finally get and offer for a brand new gig. When you put in your two weeks notice with your manager, they come back with a counteroffer to match what your new employer will give you. Suddenly, you have what feels like two job offers to pick from. At Kavaliro, we caution our candidates not to take counteroffers that their current employers offer.
We see a lot of individuals take a counteroffer and then six months to a year later they have been let go. When you accept a counteroffer, your current employer now knows that you don't want to work for them anymore. By giving you the counter offer, they are allowing themselves time to find someone to fill your job with limited interruption. We see this happen with about 45% of the individuals who accept counteroffers. Why risk potentially being out of work because you took a counter offer? Individuals forget that just because you have been offered a counteroffer does not mean you were given job security.
When an average individual changes jobs, they can expect to see an average salary increase between 10% to 15%. A current cost of living salary adjustment is somewhere around a 2.8% to 3.1%. If your company, like most, only hands out the cost of living adjustments each year then nothing will change the fact that you are under-compensated.
Most people don't leave their current job because they can make more money somewhere else. Often factors like lack of management recognition, lazy coworkers, low growth potential, and long commutes are to blame. If you take the counteroffer, you are still going to be stuck with the lazy coworkers, the boss who micromanages and the long commute- but will be making more money (and might have some added responsibilities). We encourage every individual contemplating a counteroffer to answer this questions "If you didn't like working there when you were making X, why would you like working there just because you are making Y?".
Ask yourself, "How is it that when I asked for a raise, and they offered me X, but now that I am leaving they suddenly see that I am worth Y?" The answer is that they probably still don't see you as worth Y, but that it is cheaper to give you a raise then to attempt to find a new employee to fill your spot and lose the knowledge. If you plan on leaving your company but don't want to put them in a rough spot offer to work "on call" to assist as your replacement gets up to speed.
If you are still considering taking a counteroffer (after thinking about why you are suddenly "worth" more money to your original employer) ask yourself these questions:
- Will I always have the same job and responsibilities?
- Will I be reporting to a new manager or department?
- Will I be compensated at a rate that is standard within my industry?
- Will I still be bored and want more challenging work?
- Will my potential for career growth change?
- Is my commute going to become shorter or less frequent?
- Does my work-life balance get any better?
While starting a new job can be a little rough, it might just be what you need to get yourself to the next "level" or stage in your career. Don't settle for the counteroffer when your current employer has already shown that they undervalue your worth.
If you need resources to find out what the average salary is for someone with your job title in your area check out LinkedIn's Salary tool.