We’re in one of the most challenging recruiting climates in decades, making it more important than ever for insurers to hone their hiring and retention strategies. In our conversations with hiring managers, as well as in our own experience as recruiters, we’re seeing an uptick in counteroffers from candidates’ current employers. Considering 72% of insurers are planning to hire this year, counteroffers will likely become even more prevalent. In this edition of Recruiter Report, we’re sharing insight on a pressing question: How can organizations most effectively handle counteroffers?
Understand the current recruiting environment.
The insurance labor market continues to tighten, with unemployment remaining low and job openings at an all-time high. Additionally, according to our Q1 2022 Insurance Labor Market Study, conducted in partnership with Aon plc, overall recruiting difficulty is at a peak, and positions within all insurance functions have become more challenging to fill in the past year. There is simply not enough qualified talent to meet insurers’ current needs and as a result, traditional processes must be reimagined to remain competitive.
Prepare for increasing candidate expectations.
In a past Recruiter Report, we shared how COVID-19 and the remote environment has impacted candidates’ expectations of an employer and role. Along with flexibility in hours and work location, salary expectations are continuing to rise. Candidates are in the driver’s seat and interviewing employers as much – if not more so – than employers are interviewing them. Anticipate that active candidates will receive two to three additional offers in today’s market and ensure you’re using the interview process to sell the role and your company. Focus on how you will meet their needs, while emphasizing long-term career progression and development opportunities.
Be direct throughout the recruiting process.
Ensure you’re continually asking candidates questions around what it will take for them to accept an offer and are clear on their expectations. It’s common for professionals to change their compensation requirements as they move through the recruiting process. Having frequent and direct conversations will help avoid surprises when you’re ready to extend an offer. Additionally, make sure you’re moving quickly and outlining next steps and anticipated timing to avoid losing interest and momentum.
Expect a counteroffer.
While counteroffers from candidates’ current employers may have been less frequent prior to the pandemic, they should be anticipated in the current environment. Build a hiring strategy that accounts for this new reality. If you’ve maintained transparent communication with candidates, you should have a clear idea of what they require to make a move. Leverage this information as you develop your offer and compensation package, striving to present your highest offer first. Consider the following questions: What can you offer that their current employer cannot? What might they be receiving as offers from other companies? A slight change in salary is easy to counter and often existing familiarity and comfort will weigh in the current employer’s favor. Don’t be afraid to go high and provide an offer the candidate can’t resist.
Focus on retaining your current team.
While you navigate counteroffers within the hiring process, it’s likely your current employees are simultaneously being recruited by your competitors. Acknowledge this and consider how you can secure their loyalty within your team and company. Ask how they feel about their current position and compensation. Understand whether they’re happy and what would cause them to entertain leaving your organization. With clear and open communication, it’s less likely you’ll be blindsided. At the same time, if you are considering making a counteroffer to keep an employee, consider the long-term impacts. According to research, 57% of employees who accept a counteroffer end up leaving their employer within two years.
Counteroffers are a very real and prevalent part of today’s recruiting environment. By anticipating them within your recruiting strategy and ensuring you’re presenting strong initial offers, you’ll be best positioned to hire qualified talent in the competitive market. For insight on other pressing questions we’re discussing with clients, view past editions of Recruiter Report.