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The problem with #2 is that if a company spends $30k of time and effort to get an employee trained up, the poaching company can offer a raise of 10k and still b
by Raidion 8y ago
The problem with #2 is that if a company spends $30k of time and effort to get an employee trained up, the poaching company can offer a raise of 10k and still be in the black 3 years later. If the original company decided to match that offer, they're now spending 60k more over three years, and the poaching company can offer a 15k raise and STILL be in the black after 3 years. Any money you pay in training is a sunk cost that doesn't have to be paid by your competitors.
- gerbilly 8y agoSure but presumably, unless all employees start out only at your company, then the effect would also sometimes happen in your company's favour. As I said in point #1, as long as the rate of defections/arrivals is about even, then your losses on one employee would be offset by your gains on others.
- thereisnospork 8y agoHaving an even defection/arrival rate requires other companies to also train their employees, and not only hire previously trained persons.
- magduf 8y agoWhat makes you think the poached employee is actually going to stick around for 3 years, instead of jumping ship when Company C comes along and poaches them for a $10k raise? Most people in Silicon Valley these days don't stay in jobs for 3 years, according to what I've read.