An article published by the IRC is becoming more and more relevant in the times ahead. In the tight times like today, companies are rethinking their headcount requirements and the positions that are not on the critical path of the delivery of the service or the product are in real danger. A large number of the companies are just not replacing the people that have left this year, thus decreasing the headcount. The others are simply offering a redundancy packages that we can read about every day (Jobs News).
In the same time every single company will do all in its power to keep its best people, the core team, the drivers of the business. And this is where the retention comes into play:
Faced with an increasingly tight employment market, competition for experienced staff has not just impacted hiring strategies but even more so retention strategies as companies are increasingly using counter-offers as an essential part of their retention strategy. Experienced staff are often faced with multiple offers and quite often these will include a counter-offer from their current employer.
We have seen clients increase salaries by up to 50% in order to retain key members of staff within the finance sector – the costs of replacing staff are so high and competition is so tight that companies are pulling out all the stops in the ongoing issue of staff retention.
It is a difficult decision to weigh up a new company against your existing employer when a decent counter-offer is on the table and employees should carry out their own due diligence when looking at any new opportunity. Accepting a counter offer can seem like an easy option but it can also have a long-term impact on your career. When weighing up a counteroffer against a new offer of employment we would always advise candidates to analyse the reasons that prompted them to look for a new role in the first place. Quite often a counteroffer will offer a pay increase but you will fail to really address any other issues that you may have with your existing company. Our experience has shown that once someone accepts a counteroffer they will still start looking for a new role six months later!
What we will see more in the remaining in the 2008 is that people who stay with their current employer – DO NOT leave their employer that easy after receiving the hefty salary upscale. Interest rates are going up, house prices are going down. People will want to feel some security that they will be able to pay the raising mortgages.
Unless you are the CEO of Ryanair CEO Michael O’Leary, or Unilife CEO Alan Shortall, or someone on their level, it is quite unlikely you will be changing your employer for a higher salary, and be starting from the scratch with a new employer in the last quarter of 2008.