Job Offer Negotiations: Setting the Stage for Long-term Job Attitudes

As the economy recovers and workers have alternative opportunities, employers may find themselves negotiating terms and conditions of employment with good candidates. If so, they may be interested in a 2009 study that revealed that the negotiation tactics used during the selection process have long-lasting effects on work-related attitudes. Further, the authors found that non-economic issues were more important in determining those attitudes than the economic outcomes gained during the negotiation.

The study¹ examined the degree to which economic and subjective value influence employees’ job attitudes (i.e., compensation satisfaction and job satisfaction) and intention to leave the organization. Economic value was defined as base salary and other guaranteed compensation (e.g., relocation allowances, tuition reimbursement) plus the perceived value of the concessions received during the job offer negotiation. Subjective value was defined broadly to encompass the feelings, perceptions, and emotions related to the negotiation process. Specifically, it includes four dimensions: the candidates’ feelings about (1) the outcome, (2) themselves, (3) the process, and (4) the relationship among the negotiators.

Results indicate that one year after the initial negotiation, employees’ subjective value significantly predicted compensation satisfaction, job satisfaction, and turnover intention. The higher the subjective value, the higher the subsequent compensation and job satisfaction, and the lower the intention to leave the organization. In contrast, the economic value achieved was not associated with these three outcomes. Thus employers would be well advised to pay careful attention to their job offer negotiation process: with little or no additional investment, it can result in long-term positive benefits.

Based on the study’s findings, here are five practical implications for conducting job offer negotiations:

  1. Treat a positive subjective experience during the job offer negotiation process as an asset that improves the quality of the working relationship: protect and nurture it.
  2. Ensure your negotiators represent the organization well: their behavior often shapes candidates’ first impressions about the organization and their attitudes toward the job.
  3. Train your negotiators to address the four dimensions of subjective value listed above to achieve the desired long-term beneficial outcomes that a positive subjective value experience can provide.
  4. Make sure the negotiators clarify the value of the concessions to job candidates so they can appreciate them fully.
  5. Treat job candidates respectfully, honestly, and as valued partners in the employment relationship to ensure positive, long-term benefits.

¹ Curhan, J.R., Elfenbein, H.A., & Kilduff, G.J. (2009). Getting off on the right foot: Subjective value versus economic value in predicting longitudinal job outcomes from job offer negotiations. Journal of Applied Psychology.

Pat Lynch, Ph.D., is President of Business Alignment Strategies, Inc., a consulting firm that helps clients optimize business results by aligning people, programs, and processes with organizational goals. Pat can show you how to apply relevant research findings in practical ways to create immediate results in your organization. Contact us today to see how we can help you make a difference!

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