WTF #18: Offer, Counteroffer

WTF #18: Offer, Counteroffer

Although I don’t officially start work until tomorrow, I am in the office a day early to take care of some urgent matters. My first official order of business is to present a counteroffer to a team member who has just tendered his resignation. He has accepted an offer from some other giant multi-national to do analog design. I like to think that it isn’t an indictment of my management skills, and given the short amount of time I’ve managed the team, it shouldn’t be. Still, it kinds of nags at me at a semi-subconscious level.

The IC design landscape in China is quite like Silicon Valley during the dot-com boom. Job hopping is common and unrealistically high salary expectations are the norm. Of course, what makes it the norm is that giant multi-nationals are willing to pay those sort of raises. In this particular case, we are providing a salary increase of 30% as a counteroffer. Gosh, what engineering job in the Western world can you receive a 30% increase only a short 4 months after one’s last annual raise. Those good’ol days of the late ’90s in the US have indeed passed on by.

It makes me wonder when the bubble here will burst and when will the cost of engineering talent approach the cost of doing business in the West where it no longer becomes a cost advantage to hire in China. Hopefully, I’ll be out of here by then.

What The Flux is a semi-regular feature on that follows the follies and jollies of an engineer in industry, yours truly.



To be honest, I think that what your analog design engineer is doing is natural. After all, how long will that situation last. Get as much as long as the getting is good right? Though I wonder, every time someone is sick or taking a day off, what is really happening.

As someone who has never worked in the good old days, I am in envy.


My guess is that this engineer saw you coming in and was afraid it would mean a lot of changes. I imagine it was caused by the change, not you as an individual. I know that in a lot of places, a new manager coming in can also mean a lot of reorg, which is not usually a fun thing.

Unfortunately, this appears to be standard practice nowadays. It is also the only recognised mechanism to ensure that your employer keeps up with the market rates for engineering employment. In-house annual raises appear to be slipping back underneath general inflation rates, meaning that if you stay working for the same company, your overall standard of living will suffer.

It’s a shame, because there are talented, committed and reliable people working in engineering – but because of a lack of investment in people these same engineers are having to choose between their employer and their worth.

Will, you are bang on with your analysis. The in-house raises are indeed below the rate of inflation. The rate of inflation in China is quite high though. In this particular case, salary wasn’t the main issue (although it’s a close second), but we are trying to move forward with some preemptive salary raises to stem a flood of engineers leaving the company.

Sounds like your company has working environment problems. If you’re so behind in keeping up with payroll vs. inflation, it makes me wonder what other humanist issues are lacking. You’ve undoubtedly heard that most people quit their managers, not their jobs. In this case it is the previous management that can take the blame. Will they let you fix anything, or will all of their solutions be reactionary? Prepare for major turnover, even if you try to offer money.

ferd, thanks for your thoughts on this. I actually think the company treats its Chinese employees quite well. Like I wrote above, it feels a lot like the late 90s in Silicon Valley. Lots of company sponsored sports programs, team building, and even free massage therapists. But on the salary front, this is an industry wide problem. Too many openings; too few qualified engineers. Recent inflation rates have been ~6-8% here per year and it’s quite difficult for multinationals to justify those sort of increases to its shareholders. At the end of the day, it is still force to do it via retention strategies, but giving out 6-8% cost-of-living raises sure ain’t the norm here nor in any other big corporations here.

As for the employee that wanted to quit, his reason wasn’t management at all. He has personal reasons beyond salary and we’re trying our best to accommodate him. He has decided to stay if those non-financial accommodations are approved by upper management.

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