So, you've found a new job with a great new company and handed in your resignation at work.
But what do you do when your current employer offers you a big pay rise to stay? Sounds like a no-brainer but is it really that simple?
According to research by the National Institute of Economic and Social Research, the average British worker saw an 8% fall in real wages between 2008 and 2013. If you've been feeling the pinch, you may have started to look around for a new job that offers you exciting opportunities for growth, a fresh challenge, plus a nice pay rise.
As a job hunter, once you accept a job offer and resign, your current employer may match or exceed the salary offered by your new job. And the more senior you are or the more scarce you skill set, your current employer could counter your new job offer with a pay rise of up to 20% to stay put.
Although you decided to leave your current job for all the right reasons, you’re now facing a tough decision that’s based purely on money and here’s the financial reality for an example role (assuming salary enhancements alone):
£50,000 basic salary
New job offers a 10% increase = £55,000
The 20% counter offer = £60,000
Walking away from a £10,000 pay rise is going to be tough, plus there’s all that stress and risk when you change jobs, right?
Back to basics
If you’re faced with a counter offer, think back to your original reasons for wanting to change jobs. In my experience, there are usually five main influencing factors:
- The reputation and profile of the new company – is their ethos and culture in line with your aspirations?
- The profile and complexity of their key projects – will these allow you to broaden your experience or gain more specialist knowledge?
- The new role – is it a step up and a challenge?
- Future prospects and career path – are they better than where you are now?
- Remuneration – consider the short and long term benefits the salary will offer
These echo psychologist Fredrick Herzberg’s Motivation-Hygiene Theory, which researched sources of satisfaction and dissatisfaction in the workplace:
The work itself
Although salary might be your main motivator for changing jobs, it’s only one of many sources of dissatisfaction in the workplace. Carefully consider whether a counter offer will in fact counter all of your reasons for deciding to move jobs.