The bonus picture is changing gears in 2024 — and so are counteroffers

The labor market may have softened from its pandemic highs but the battle for talent is still strong — and employers that want to snag their top recruits need to act fast.

That's according to new data that shows how the job market, signing bonuses and counteroffers are evolving in 2024.

About 48% of workers recently hired said their new employer responded to their application within three days, and 92% said it happened within a week, according to a survey of new hires by ZipRecruiter. Meanwhile, about 46% of newly hired workers said they were recruited to their new jobs by their employers — up from 36% a year ago.

“When employers proactively recruit talent or respond to applicants quickly, it instills a sense of being valued and sought-after, which can be incredibly affirming and gratifying,” said Marissa Morrison, vice president of people at ZipRecruiter, in a report on the survey.

Overall, 58% of those who got a new job in the past year found their experience to be “good,” compared to about 60% who said the same in the fourth quarter of 2023.

The competition for talent is still strong, evidenced by perks being offered to prospective employees. About 23% of those who got a new job within the past six months said they got a signing bonus, down from 29% in the previous quarter. Meanwhile, 24% of workers said they received a counter-offer from their previous employer, up from 21%.

Signing bonuses still used to lure top talent

The United States gained 303,000 jobs in March, beating expectations as the economy added jobs in sectors like health care and leisure and hospitality. That drove the unemployment rate to 3.8% — near historic lows and one of the longest prolonged streaks of low unemployment in the past half century. Unemployment has hovered between 3.7% and 3.9% since August.

Leslie Loveless, CEO at Slone Partners, a nationwide executive recruiting firm that serves health care and biotech-related clients, said 2024 is a better job climate than 2023, when many companies were focused on cutting costs and, thus, laying off workers. But when it comes to top-tier talent, companies are always competing.

“There is always a shortage of A-plus talent. Always,” Loveless said. "People that are really great at whatever function they lead and whatever skills they have, they are usually able to land on their feet.”

Loveless said signing bonuses are usually offered when a prospective employee has earned a bonus elsewhere and is hesitant about leaving their current job until they've gotten it. The company recruiting them often offers a bonus to make up for that loss and get the employee on board quicker — part of the reason why signing bonuses are still offered, even in a softer job market. 

Now, when a company closes their doors or lets workers go, other companies in that same space are watching and trying to land top talent from those places. 

Companies have also learned to hire faster over the years, Loveless said

“In the market we serve, candidates are here today, gone tomorrow, in many cases," she said. "You need to be efficient in your process, and that is an evolution I have seen over the years. It used to drag out.”

One growing trend Loveless is seeing: hard lines that both the employer and potential employee will not budge on, a change from the height of the job market in 2021, when both companies and workers were willing to compromise. Now, employees that want more remote or hybrid work are willing to walk away from jobs with companies who want workers to be in office, or the other way around. 

“Those are things that clients and candidates are quite willing to take a firm stand on," Loveless said. "If it means they lose the opportunity or lose the candidate, they have gotten to the place where they're OK with that, in many cases. That's definitely a thing I have seen getting stronger in its effect over the last six months.”

Pay, salary issues still top of mind in 2024

A growing share of employers are posting salary ranges in their job ads — a shift becoming almost mandatory in the pursuit of top talent.

About 60% of organizations are publishing pay ranges in job postings in 2024, compared to just 45% in 2023. That increase is the result of a series of new legislation and recruiting pressure, according to compensation software and data company Payscale Inc.’s 2024 Compensation Best Practices Report (CBPR)

Employees also continue to expect significant pay bumps, even with less turnover. Organizations predicted an average base pay increase of 4.5% in 2024, down slightly from the 4.8% in 2023, according to the Payscale report. About 79% of organizations plan to give pay increases, down from 86% in 2023. Voluntary turnover was 21% in 2023, down from 25% in 2022.

But employee expectations aren't coming down, according to a recent Franklin Templeton Voice of the American Workplace Survey 

In a 2024 Work Watch Report by Monster Worldwide Inc., 81% of workers said their current wage has not kept up with the rising cost of living, and 46% of workers said they had higher salary expectations than they did in 2023. The American Staffing Association Workforce Monitor survey, conducted in conjunction with The Harris Poll, found 53% of workers feel their paycheck is not keeping up with inflation.