You made an offer to your perfect candidate only to have the offer turned down. Being jilted at the altar is painful! And, in addition to the pain of rejection, the time and money you spent on the hiring process goes down the drain. Statistics reveal that 17% of offers will be rejected. Yet, this number could rise to 35% if remote work option is not offered. Thus, companies need to be prepared for the possibility their top candidates may not accept presented offers.
According to a CareerBuilder survey, 39 percent of respondents declined offers because they accepted another offer. But why do they accept these other offers? Long hiring cycles can be partially to blame for rejected offers. A candidate’s interest wanes while they wait and competing offers may be received and viewed as more appealing or secure. As hiring managers delay hiring decisions or continue their search for a Unicorn (a perfect candidate that doesn’t exist), they increase the risk of losing their top candidates.
But, let’s assume there were no delays in your hiring process. If candidates are accepting other offers, there is a good chance your company’s compensation plan is not in alignment with current market conditions. In today’s market, top candidates have the upper hand in salary negotiations. For lateral moves, the average bump in base pay is 10-20% to have a solid player move over to your side of the court. If the position is a promotion with more responsibility and higher expectations, that percentage may rise to 20-30%. Are you prepared to offer your candidate more than they currently earn? Are you equipped to manage the possibility that you may need to pay a new hire more than current team members?
Survey after survey reveals that compensation and benefits are the main reasons why people look for new job opportunities.
The bottom line . . . money talks!
Here are the top reasons why candidates reject offers according to the CareerBuilder survey.
• Accepted an offer from another company. (39% – likely because it was a higher offer)
• Total compensation is not high enough. (29%)
• Received a counteroffer from current employer. (10%)
• Job location is undesirable. (9%)
So, what should you do if your job offer is rejected?
Ask Why: It is important to know why a candidate turned down your offer so you can learn from the experience and adjust for future hiring decisions.
Counter back: Sweeten the pot with higher salary and benefits, more vacation time, better job title, or more advanced responsibilities. Assuming no competing offers, the cost of re-starting the hiring process may cost more than bumping up the base salary.
Walk away: Sometimes the candidate knows what’s best for them. Trust their decision and move on to other candidates.
Try again: Make an offer to your runner-up candidate or start sourcing again for a new pool of applicants. Stay positive. Sometimes a better candidate comes along!
If you need help navigating and negotiating an offer with a candidate, give us a call at 317-578-1310.