Counter offers in talent retention strategies becoming ‘widespread’, CIPD reports

Summary

The practice of using counter offers to retain key talent is becoming more common, according to CIPD research. A survey of 2,000 employers found that 40% of UK employers have turned to counter offers to keep key staff, and 51% of those already using counter offers have increased their use in the past year. Experts warn that while counter offers may help retain staff, they should be approached with caution as there could be knock-on effects such as pay gaps and a drop in employee engagement. Employers are advised to reward staff consistently and not fight to keep employees who want to leave. The research also found that 45% of employers believe counter offers are effective in retaining employees for 12 months or more, but many employers do not have a specific policy on them. Instead of using counter offers, employers should focus on maintaining a strong employer brand and improving the quality of jobs they offer.

Q&As

AI Comments

👍 This article provides an insightful look into the effects of counter offers on talent retention strategies. It also provides helpful advice for employers who may be considering counter offers.

👎 This article fails to provide any concrete solutions for employers who are struggling with talent retention. Additionally, it fails to provide an in-depth analysis of the potential risks of counter offers.

AI Discussion

Me: It's about counter offers becoming a "widespread" practice in talent retention strategies. Experts are warning that offering more money to keep people could have knock-on effects and instead advise employers to have a strategy that looks beyond pay.

Friend: That's really interesting. It sounds like employers are having to offer more money to retain key employees.

Me: Yeah, it does. It's a sign of how competitive the job market is right now and how difficult it is to find the right talent. It also shows that employers need to start thinking about alternative strategies for talent retention, like offering other benefits or creating better job opportunities, instead of just relying on money. Otherwise, they could face equal pay challenges or a decrease in employee engagement.

Action items

• Develop a comprehensive retention strategy that looks beyond pay.
• Establish a consistent reward system for all employees.
• Invest in employer branding to attract talent and create a positive work environment.

Technical terms

Counter Offer

An offer made by an employer to an employee who has received a job offer from another company, in an attempt to keep them in their current role.

Labour Market Outlook

A report published by the Chartered Institute of Personnel and Development (CIPD) which surveys employers to provide an overview of the UK labour market.

Basic Pay Increase

An increase in an employee's base salary, which does not include bonuses or other forms of compensation.

Knowledge Drain

The loss of knowledge and skills from an organisation due to the departure of employees.

Pay Gap

The difference in pay between two groups of employees, typically based on gender, race, or other factors.

Employee Engagement

The level of commitment and enthusiasm an employee has for their job and the organisation they work for.

Real-Term Pay

The amount of money an employee earns after taking into account inflation.

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