Perceptions & Job Satisfaction

Kimball Kjar
Managing Principal Recruiter
Venator Ventures

Job satisfaction. What is it? What makes a person like this job or that job? It’s not an easy answer for anyone and there have been numerous studies performed that try to definitively show what things a company should or shouldn’t do to ensure that they have “happy” employees. Because, as these reports assume, when the employee is happy, then the company will fair well.

In my career as a recruiter I’ve seen all sides of the employee job satisfaction array—from blissfully happy to vindictively upset. And throughout each instance there is one under lying reason as to an employee’s satisfaction: salary.

Now, you might say as a recruiter, my opinion is skewed since in most instances my commission is tied to salary. But hear me out and you’ll see what you and your company can do to improve job satisfaction via increased salary and that by so doing decrease the company’s hiring and other related “soft” costs.

A recent study showed that an employee’s salary is tied to job satisfaction in 1 out of 2 cases. But this survey also shows that salary is the real culprit less than 25% of the time. How can this be?—Perceptions.

We’ve heard the phrase “perception is reality” and in the world of recruiting and hiring it’s an even more elevated truth—it’s gospel. One example of misaligned perceptions is given in the above mentioned study. “Over-titling” gives people a false sense of reality and responsibilities and as such, leads to the feeling that the employee isn’t paid enough for his or her role within a company. An employee’s perception is greater than what is in fact reality.

As employers it’s unlikely that we ever fully comprehend the thoughts and intentions of our employees in spite of our best trained senses and abilities. And as such, every individual is left to his or her own internal dialogue to determine their state of being.

But when it comes to job satisfaction it’s not just “over-titling” that leads me to believe that this misalignment of perceptions is the root of the problem. It starts long before a candidate is ever hired, during the interview process.

If a company hires on a candidate after a fully vetting process of interviews from peers to the executive team, properly performed background and reference checks, then that company should feel like they’re done all that they need to do, right? WRONG!

They’ve neglected on major step: the offer package.

This stage of the process is often overlooked on account of numerous reasons which include budget constraints, personal interest, company HR standards, etc. Most companies will say that they are “set in stone” on what they can offer a person in terms of salary. By doing so, the company feels like they are offering “market standards” for the candidate and in some instances that the candidate should feel lucky to be even getting a new job.

This line of thinking is usually left to the companies that are having a hard time finding the best talent and also keeping them over the long run. Why? Perceptions.

It all comes back to perceptions. No matter how well a company brands itself or even sells itself to a candidate, the perception implied in the offer-making process to the candidate by the company is: “What is the perceived value of this commodity (aka the candidate)?” And if the candidate feels like they’ve given up more than their fair share, it stays with them for the duration of their employment at the company.

Another saying comes to mind—“You never get a second chance to make a first impression.” And it’s no more true than during the offer-making process of hiring a candidate. If they feel their first impression of their soon-to-be employer is one where they feel unappreciated and under-valued, then that will stay with that employee for a long time.

The crux of this topic is that when times get tough, and they’re tough for more than our fair share of companies right now, any excuse that an employee has to walk out on their employer is accentuated when he or she feels that they are not valued according to what they feel they should be.

Most candidates and companies I work with have been very good about realizing that you don’t always get everything that you ask for during the offer stage. But the successful companies that I perceive to have great employee job satisfaction rates usually are the ones that go out of their way to make the candidates feel valued, appreciated and in some cases loved.

Fortune Magazine recently listed Bay Area stalwart Google as the best place to work. Among other reasons of open communication between manager and employees, team building activities, and such Google’s equity plan is offered to 99% of all the 12,000+ employees. And with the stock having cracked $700 a share it’s easy to see why there’s a term “Google-aires” running rampant in the Bay Area. It’s also widely known that Google’s compensation ranges average as some of the highest in Silicon Valley, but the company didn’t disclose this data to Fortune.

It’s also of note that in the same study by Fortune Cisco and Network Appliance showed the 12th & 13th respectively highest average salaries in the country for employees and that both held the highest average salaries for tech companies behind leading financial, petroleum and legal companies. It’s also worth noting that Cisco and NetApp both rank as 6th and 14th respectively on the overall list of “100 Best of Companies” to work for nationally.

Those company’s that don’t financially compensate the employees well usually are tied by CFO regulations on what they can “actually” spend and don’t have an environment to do what it takes to care for their employees overall. Trust me, I’ve seen it over and over. Companies who are pinching pennies, usually have high turn over rates. But you can still be fiscally responsible while also leaving yourself open to finding and hiring the best talent.

The costs of not looking to financially “well compensate” employees is given in the above cited study. It cited that “HR professionals estimate that the hard costs to replace an employee ranges between 33% and 50% of their base salary, in addition to soft costs such as the loss of productivity and institutional knowledge, as well as new hire recruiting and training expenses.” Isn’t an extra $5-10k given to the candidate during the offer stage worth it in this light?

So what are some solutions to this perceptions gap? I would contribute the following:

1. Pay an extra share of money for the candidate to feel like he or she is valued—give them what they want (within reason).
2. Don’t balk at counter-offers. If a candidate has been looking else where, don’t kick them out, but ask yourself why this person felt the need to look around. This could help hiring and retention processes in the long run and possibly reveal fatal flaws in your company’s human resource strategies. Plus, the cost of finding someone else to fill a vacated role can be prohibitive in the long run as opposed to offering a competitive counter-offer.
3. Work to bump pay at least 10% each year while offering performance based bonuses and equity grants.
4. Work with an experienced recruiter who understands this perception dilemma. Often, a recruiter can manage the candidate to ensure that he or she is “blissfully happy” about the offer and job opportunity.
5. Educate current employees, tactfully via HR, at performance reviews about market standards on pay and compensation.
6. Work diligently to develop retention strategies that offer candidates feelings of ownership, community and an ability to communicate their thoughts and feelings with their managers, peers and subordinates.

If you do this you’ll fight the perception dilemma head on and see positive employee job satisfaction while also decreasing operational costs over all.

The bottom line is that you want to have new employees walking through your doors on his or her first day saying, “I’m excited to be here and I can’t wait to help this company in what ever way I can!”

Trust me, I’m a recruiter…;-)