Recruiting new employees is more expensive than retaining existing staff. Research has shown that it can cost twice the annual salary to replace the staff position.
The time taken to search, interview, and on-board new hires is widely underestimated.
However, 80% of those who accept counter offers end up leaving within the next 6 months. But why?
Money isn’t everything
Money is just one motivation factor to a job. Admittedly, it’s a big one, but in 80% of the cases, money does not fix other existing issues.
Do you ever look back at previous roles and remember it for the money? Not nearly as much as we remember the people, the opportunity, the experience.
Other reasons for leaving
Work life balance, career progression, and stability are other key motivational factors that creates a need to look beyond the current employer.
Life after the offer
If you stay, you may have underlining trust issues with managers.
Once you have made it known your desire is to leave, this could cause friction and an even less likable place to work than before. Especially if you were interviewed by a competitor.
Managers will question loyalty in future cases, which may affect future growth opportunities and pay rises.
This effect is usually irreversible.
As an employee, do you really want to work somewhere when they react to a threat? Companies should actively reward success. If they offer more money in a counter offer, this is because you earned that value.
What about your colleagues?
If word gets around that you received a raise to those doing the same job or same pay grade, they could be a little upset. Equality between staff is a key to a happy workplace, so being singled out with more money could make it an even less likable place to work.