New job or accept counter offer at old?

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New job or accept counter offer at old?

Postby pannkake » Mon Jun 11, 2012 12:01 pm

Hi,

I'm trying to choose between starting a new job or accepting the counter offer from my current company. I'm a mechanical engineer with 13 years experience, and I live in an expensive west coast city.

I've been at my current job for 8 years, but I haven't had a raise in 5. The company has a lot of money tied up in a big foreign project, so they always have cash flow problems.
Pay is 63k/year + occasional bonus, overtime, and overseas pay. I made about 87k last year by working almost every Saturday and a month overseas.

Current job pros:
very short commute (1.5 miles)
flexible hours
interesting work (we build the wild prototype stuff that no one else will touch)
low level of supervision
interesting people
company is in great urban location

cons:
low pay

I went job shopping this spring and found a company that really wants me. After a little negotiation, they offered me 90k/year with the same overall benefit package. No overtime or travel required. More money for less work.
cons:
10 miles commute to boring industrial area
don't know anyone there
work is less interesting, but should still have some good challenges

When I went to the owners of the place I currently work, they said they really didn't want me to leave and lots of flattering things about my skills, and have offered me a raise to a base of 78k with the overtime and bonus pay schemes staying the same.

I'm really comfortable at my current job, but I can use all the money I can get. My partner is about to start grad school in a medical field, and I'd like to pay for that with cash. She should be able to get a good job in about 2-1/2 years, at which point we'll have plenty of money to do the things we want to do.

thanks for your thoughts.
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Re: New job or accept counter offer at old?

Postby FrugalInvestor » Mon Jun 11, 2012 12:13 pm

Providing the new company is in better financial shape I'd go there. No raise in 5 years and continual cash flow problems spells trouble in my estimation.
"Some men worship rank, some worship heroes, some worship power, some worship God, and over these ideals they dispute and cannot unite, but they all worship money. - Mark Twain
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Re: New job or accept counter offer at old?

Postby Fallible » Mon Jun 11, 2012 12:18 pm

pannkake wrote: ...
I'm really comfortable at my current job, but I can use all the money I can get. My partner is about to start grad school in a medical field, and I'd like to pay for that with cash. She should be able to get a good job in about 2-1/2 years, at which point we'll have plenty of money to do the things we want to do.



Of all the excellent pros and cons you've listed to help you decide, the paragraph above struck me as possibly the most significant because what I take from this is that you're considering a change mainly for money. And in the above graf, you explain why: to pay cash for your partner's grad school. If that conclusion is accurate, and if she gets a good job in a fairly short period of time so that you'll have "plenty of money," then I would say you should stay with the job you seem to truly love for many sound reasons, including an important one that provides challenge and would seem to offer all-important growth: the "wild prototype stuff" you mentioned (sounded interesting to me!). It means finding another way to pay for her grad school, but at least try to come up with payment alternatives you can consider as you make your decision - a decision that perhaps you should both make together, if you're not already doing so.
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Re: New job or accept counter offer at old?

Postby downshiftme » Mon Jun 11, 2012 12:19 pm

Old company knows you have looked outside, and you are now on the disloyal list. When money gets tighter, which it sounds like it will with this problem plagued company, you will be near the top of the expendable list. Unless you have an exceptional relationship with the people in power in your current company, that bridge is already burned. Go to the new job and learn some new things.
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Re: New job or accept counter offer at old?

Postby NateW » Mon Jun 11, 2012 12:25 pm

Yea, you are on your company's you know what list, most likely. If you are, and they let you go after you have lost the opportunity to go to the new company, where would you be? They could be waiting until they find a viable replacement before they drop the hammer on you.

Although I have never been in this situation, I've been told more than once to NEVER accept a counter offer. It may be ok, or it may not. The problem is you don't know which way it will go.

--Nate
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Re: New job or accept counter offer at old?

Postby alanf56 » Mon Jun 11, 2012 12:38 pm

I would take the new job and not look back. From the description of the monetary problems of the current company and the fact they know you looked elsewhere I would not figure them to be loyal to you when things get tough. The commute won't be that big of deal and you will make new friends at the new job in no time. GO FOR IT!!!
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Re: New job or accept counter offer at old?

Postby Skinut » Mon Jun 11, 2012 12:41 pm

alanf56 wrote:I would take the new job and not look back. From the description of the monetary problems of the current company and the fact they know you looked elsewhere I would not figure them to be loyal to you when things get tough. The commute won't be that big of deal and you will make new friends at the new job in no time. GO FOR IT!!!


+1 And, working every Saturday..... I'm all in favor of getting ahead, but at some point you have to ask yourself what you're working for.
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Re: New job or accept counter offer at old?

Postby hicabob » Mon Jun 11, 2012 12:44 pm

.... or counter the 78k offer with 95k plus a 2 or more year contract? Worst case - they say no and you start at the new job.
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Re: New job or accept counter offer at old?

Postby WatchinU » Mon Jun 11, 2012 12:47 pm

I've heard many HR types discuss the "counter" offer. Many say that its not a good idea to accept those. The managers do not trust the person when they stay. They are thinking that you are not loyal and may leave at any point in the future. If they have layoffs then you might be at the top of the list.

You stated that you are "comfortable". Perhaps you need to consider stretching yourself in another career opportunity.

Its normal to gravitate toward the thing you know best. My concerns would be that your current company has not given you a raise in 5 years, works you most Saturdays, they value you skills but only communicate that when you give your notice, and they have cash flow problems. I know many folks that were not paid as their companies were going under. They were told don't worry...we promise to pay you. Then they were not able to pay their bills and they also lost their job -- the company couldn't turn it around.

If you decide to leave then do so on good terms as you never know when you will run into these folks again. Stay in touch and get together for lunch occasionally.
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Check out Google

Postby flossy21 » Mon Jun 11, 2012 12:48 pm

Google the word "counteroffer" and read the relevant links.

Here's a recent article I found in the top ten from Google --> http://money.usnews.com/money/blogs/out ... unteroffer

I think you will find that experts overwhelmingly recommend not taking a counteroffer. As others have mentioned the reasons are various but make no mistake, if times get tough (and they will at some point), and layoffs are imminent then you are likely at the top of the list because of perceived disloyalty.

Good luck with your decision.
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Re: New job or accept counter offer at old?

Postby XtremeSki2001 » Mon Jun 11, 2012 2:46 pm

FrugalInvestor wrote:Providing the new company is in better financial shape I'd go there. No raise in 5 years and continual cash flow problems spells trouble in my estimation.


+1

And depending on the industry you're in or the culture at your company - almost leaving and then deciding to stay when you get a counter-offer is career limiting if you want to move up in the ranks.
A box of rain will ease the pain and love will see you through
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Re: New job or accept counter offer at old?

Postby musbane » Mon Jun 11, 2012 3:10 pm

I've been there.

When I was about 30, I got an unsolicited offer from a larger company. Talked to my boss who talked to the owner. They countered at kinda close to the new offer. I did the math and after figuring in a new longer commute and a few other things, the two offers were nearly identical.

I figured that the uncertainty of the new vs. old job was a tie breaker, so I agreed to stay.

From the next day I could feel the distrust of me at work. They obviously wanted me to stay, but they couldn't help themselves.

It kept getting worse so after a month of it, I called the new company and the offer was still open (that is probably unusual).

That was over thirty years ago and I believe it (the second decision) to be the best one I ever made in my life.
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Re: New job or accept counter offer at old?

Postby Muchtolearn » Mon Jun 11, 2012 4:39 pm

downshiftme wrote:Old company knows you have looked outside, and you are now on the disloyal list. When money gets tighter, which it sounds like it will with this problem plagued company, you will be near the top of the expendable list. Unless you have an exceptional relationship with the people in power in your current company, that bridge is already burned. Go to the new job and learn some new things.


Bingo. If I were your manager in your current company, you'd be first to go and last to get a raise.
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Re: New job or accept counter offer at old?

Postby greg24 » Mon Jun 11, 2012 5:02 pm

New job.
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Re: New job or accept counter offer at old?

Postby Miskatonic » Mon Jun 11, 2012 6:01 pm

As in all things in life, I find myself the contrarian.

If the only complaint you have about your current job is the salary and they've now rectified that, I don't see jumping ship. Especially as your partner will soon be able to more than make up any shortfall.

I'm also baffled by the unanimous mentioning of your "loyalty" to the firm by having been offered a new position. Most firms don't lavish employees with raises and promotions without some initiative from the employee. If you don't help management remember what good things you bring to the organization, you usually don't get shown any love from payroll.

It sounds like they've been overlooking the work you've put in and as a consequence they've not been compensating you in proportion to your skill set and good work. IMHO, you've show outstanding "loyalty" by keeping your nose to the grind stone and not making a stink (I assume this is the case).

You've been at the shop long enough to know both the economics and the politics. If they are not in the habit of huge layoffs and retributive back stabbing, I'd accept the counter and let them know explicitly that you love your job, your co workers and the exciting work you've been privileged to perform and look forward to being able to continue to help grow the firm.

Is 12K really enough incentive at your current income/lifestyle to warrant a jump into a situation where the only "known" is you'll be doing less interesting work?

But what do I know, I'd kill to have your current salary :o
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Re: New job or accept counter offer at old?

Postby FrugalInvestor » Mon Jun 11, 2012 6:14 pm

Miskatonic wrote:I'm also baffled by the unanimous mentioning of your "loyalty" to the firm by having been offered a new position. Most firms don't lavish employees with raises and promotions without some initiative from the employee. If you don't help management remember what good things you bring to the organization, you usually don't get shown any love from payroll.


In my experience most firms have systems whereby employees are regularly evaluated and periodic raises are then tied at least in part to performance. Not receiving a raise for five years would indicated to me that either the employee is not particularly valued (apparently not the case for the OP as demonstrated by the counter offer) or the company is not well run. In either case it's probably not a good place to be working. There are solid, well run companies out there.
"Some men worship rank, some worship heroes, some worship power, some worship God, and over these ideals they dispute and cannot unite, but they all worship money. - Mark Twain
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Re: New job or accept counter offer at old?

Postby downshiftme » Mon Jun 11, 2012 6:38 pm

If I understand these offers correctly, the counter offer is still considerably below the offer from the new company. If you are willing to work most Saturdays and maybe a month overseas at the old company, then the counter offer gets you close to the total salary (including just regular work hours) at the new company. Those aren't comparable at all. If you compare the salary excluding all the heavy overtime, the counteroffer is 12,000 less than the new company.

Also, I don't think I would be concerned about a 10 mile commute. It's a lot less of a trip to go 10 miles a day compared to a month overseas.
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Re: New job or accept counter offer at old?

Postby billern » Mon Jun 11, 2012 7:01 pm

Take the new job. And be proactive in the future about your compensation. Know what you are worth and provide justification for what you are asking for during the company's review process. It is possible that a part of the reason your compensation has not increased in five years is because you were not proactive.
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Re: New job or accept counter offer at old?

Postby SteveB3005 » Mon Jun 11, 2012 7:36 pm

In hindsight have you wished you had gone to them in the beginning and said, "Man I love it here. I really do, but I need more." I mean regret is silly, but I would probably ask myself that.
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Re: New job or accept counter offer at old?

Postby tractorguy » Mon Jun 11, 2012 7:43 pm

IMOP, you're not asking the right question.

I'm a ME who worked for 2 companies in the midwest before retiring after 32 years in the field. I had a lot of technically cool projects before I decided that it would be more interesting to manage people as well as projects. That turned out to be the right decision for me. Most of the engineers I worked with and managed tended to think first of the job enjoyment, then salary, and then maybe about career advancement. This led to a lot of really good people who realized when they were in their 40's that they'd done all they wanted to do and didn't have any skills that would let them try something else. They were then stuck for the last 20 years or so of their careers topped out on their pay scale and doing something that got less and less fulfilling. Because they were comfortable, they stopped trying for the high stress jobs, stopped learning and became obsolete. They thought they had an easy job until retirement. Then the 2008 downturn hit and my company cleaned out the dead and almost dead wood. These people who were coasting were put out on the street, looking for jobs in their late 50's, with no up to date skills.

You've been happy getting paid a living wage to do something you love to do. Now, you've found out that your current company has been undervaluing you and are thinking about jumping to a different job. IMOP, you need to figure out what you want to be doing in 5, 10, and 15 years, put together a list of skills needed to achieve these goals, and then look for jobs that will allow you to develop those skills. Does either of these jobs (the current one or the new one) provide the growth, training, new experiences, etc. to make you ready for the job you want to have 3-5 years from now? If not, keep looking. At this stage of your life, every job should constantly add to your skill set and make you more valuable. If you're just doing the same things you did the year before, you are going to be left behind by your peers. FWIW, I know BSME's fresh out of school who start at the same salary you're making.

The other thing you should be considering is company health. Its much easier to get promotions and pay raises at a growing company than at one that is stagnant or shrinking. You're young and can afford to job hop for quite a while longer. However, when you hit 50 or so, you had better either have a highly valued, unique skill set, or be working on a company that will continue to employ you for the next 15 years.
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Re: New job or accept counter offer at old?

Postby Saving$ » Mon Jun 11, 2012 10:08 pm

billern wrote:Take the new job. And be proactive in the future about your compensation. Know what you are worth and provide justification for what you are asking for during the company's review process. It is possible that a part of the reason your compensation has not increased in five years is because you were not proactive.


+1.

There is alot of good advice above about what happens once your current employer knows you have looked for a new job. And when it comes down to it, you current employer is taking advantage of you. Employers tend to do this if you let them. Working every Saturday is just NOT worth it, even if they pay you overtime. And the overseas travel, which may be seen as a perk by some, does not seem to be something you relish. So this is not an ideal situation for you. Don't have misplaced loyalty. Your loyalty needs to be to your partner, and it sound like the money at the new place will come in handy.

Leave the old company on good terms, and look at this as an opportunity to learn a new way of doing things at a new company. My hope is the new company is better managed, and hopefully between that, and you following bilern's advice above, you will experience being valued by your employer. Keep in touch with folks at the old company. If things really go south at the new company, you will know when the old company has opportunities and can always go back.

...and, based on one of your previous posts, your current employer has a simple IRA; hopefully your new employer will have a proper 401k and perhaps other benefits are also better.
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Re: New job or accept counter offer at old?

Postby markpa » Mon Jun 11, 2012 10:45 pm

I have a good friend who works as an engineer, his first firm never gave him a performance review/raise for 8 years, nor was he proactive in asking for one. He was the only worker who was hired on salary, and he was the only one working every saturday. he still filled in a timecard and was expected to put in 48 hours per week. Finally the time came that he couldn't live on the work income, and still rather than asking for a raise he got another job.

He loves the new job hours away from the old one, gets a bonus of a few % per year, plus a raise and review each year. Was awarded employee of the year after only one year. His job is pretty interesting because when we are shopping he points to all the items in retail stores that he designed.
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Re: New job or accept counter offer at old?

Postby ilmartello » Tue Jun 12, 2012 12:41 am

I think your biggest mistake is the decision you haven't even scrutinized. The idea of paying for your partner's education. If by partner, you mean informal live-in situation without a marriage contract. What if he/she leaves you after he/she finishes her education and you have nothing having paid for that person's education.
I have seen it happen.
If by partner, you mean someone you are married to , disregard my post.
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Re: New job or accept counter offer at old?

Postby Default User BR » Tue Jun 12, 2012 12:54 am

Miskatonic wrote:If the only complaint you have about your current job is the salary and they've now rectified that, I don't see jumping ship.

I don't see that. The new job offers 90k with no overtime needed, the old one is 78k base with overtime essentially required. Nowhere near equivalent.


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Re: New job or accept counter offer at old?

Postby pannkake » Tue Jun 12, 2012 1:29 am

Hi,

I just wanted to thank you all for taking the time to respond to my post. Lots of good information. I didn't see any real misunderstandings about my situation that I need to clear up.

If you're wonder how I could so far off track for my career: the company I work for has a huge (for them) amount of money tied up in a never ending project with a hard to work with foreign government for about four years. Owing money to vendors and contractors all over town it's very easy for them to ignore their employees. As for me, the mechanical engineer job market was dead here until about a year ago. For the past year and a half I've been committed to a big project that was more or less "mine". I think being able to point to a picture of the machine and honestly say that I was in charge of the design, assembly, and testing, and I managed the delivery team has help my job prospects greatly. I think that the short term sacrifice to prove myself will pay off in the long run.

-pannkake
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Re: New job or accept counter offer at old?

Postby linuxuser » Tue Jun 12, 2012 6:02 am

Default User BR wrote:
Miskatonic wrote:If the only complaint you have about your current job is the salary and they've now rectified that, I don't see jumping ship.

I don't see that. The new job offers 90k with no overtime needed, the old one is 78k base with overtime essentially required. Nowhere near equivalent.


+1


Apparently, thought, the OP is staying put. Another comparable opportunity may not come around again.
That's where the misconception that if I get this job, I will as easily get another comes into play.
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Re: New job or accept counter offer at old?

Postby Colorado13 » Tue Jun 12, 2012 7:58 am

Run, don't walk to the new job. You are currently significantly underpaid -- earning what beginning engineers (i.e. just out of college with a bachelor's degree) would earn in CO, which is likely a lower COL place than where you are at. I do not mean this disrespectfully, just offering another perspective. I stayed in a position for which I was underpaid when I was right out of college too--I don't recommend that approach to others. But of course, money is not the only aspect you should consider and it appears you've given serious thought to what would be beneficial to you in the long term. Best wishes.
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Re: New job or accept counter offer at old?

Postby pannkake » Tue Jun 12, 2012 2:31 pm

Everyone,

just to give a little closure, I finally convinced my old job that I'm really leaving and I'm getting ready to start fresh at a new place. After some vacation that is. :sharebeer

Thanks again for the thoughtful advice.
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Re: New job or accept counter offer at old?

Postby Boglemama » Tue Jun 12, 2012 2:44 pm

Congratulations! You got some great advice on this board. I was amazed at the excellent points that people brought up, that I absolutely hadn't thought of. I will also post next time I have a dilemma where I need other opinions. Enjoy your new job!
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Re: New job or accept counter offer at old?

Postby imgritz » Tue Jun 12, 2012 3:09 pm

The new company is offering 15% more (for less work) after your current employer upped your base.

What ever you decide to do, continue to live on the 63K and invest the raise.
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Re: New job or accept counter offer at old?

Postby sunnyday » Tue Jun 12, 2012 3:21 pm

pannkake wrote:Everyone,

just to give a little closure, I finally convinced my old job that I'm really leaving and I'm getting ready to start fresh at a new place. After some vacation that is. :sharebeer

Thanks again for the thoughtful advice.


Congrats!! I think you made the right choice. Enjoy the time off and the new job (and the bigger paychecks).
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Re: New job or accept counter offer at old?

Postby musbane » Tue Jun 12, 2012 4:33 pm

I think that's a good move.

Just think - if it took five years and a new job offer to get a raise from your old company, what would it have taken to get your next one?
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Re: New job or accept counter offer at old?

Postby downshiftme » Tue Jun 12, 2012 4:37 pm

Glad to hear you've made your decision. Enjoy your time off and be ready to really jump right into your new position and impress them with what a good job you do, so hopefully you won't be five years before another raise. Good luck.
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Re: New job or accept counter offer at old?

Postby FinanceGeek » Tue Jun 12, 2012 9:09 pm

I gotta chime in agreeing with those who advise moving on. Really, the only time a company really shows how much they want you is when they offer you a job. Its also the best chance you have to move away from the legacy stuff you support now and learn new skills. Once you're on board at any company, there's a tendency for both sides to take the other for granted.
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