While most of us are still recovering from our new year celebrations, for many people working in real estate, the most exciting date in the calendar is still a few weeks away.
Bonus season is, for many of the candidates I work with here at Novus, not only the most important time of the year, but the reason they get out of bed every day. When you’re working 100-hour-long-weeks in a high-stakes environment, with little or no social life and a very big sleep deficit, it can be easy to ask yourself why exactly you are doing this. Bonus time usually answers that question. In recent years I’ve seen my candidates opening bonus cheques worth one hundred, even two hundred per cent of their take home salaries - the kind of reward that makes all the long days worth it.
As a result, bonus pay outs are also almost exclusively the biggest trigger of movement in the field. When bonuses don’t live up to expectations, I know that I can expect to receive a big pile of CVs on my desk from money-motivated candidates who are seeking bigger and better bonuses for the work they do.
As 2023 gets going, I am bracing myself for an especially large delivery of those CVs. Signs suggest there will be a drop in compensation pools for many. Annual bonuses in real estate are expected to be down as much as fifty percent this year, as firms continue to deal with the aftershock of the pandemic and life on the knife-edge of a recession. Interest rates have gone up substantially. We’ve had the uncertainty of Liz Truss and her disastrous mini-budget. And the war in the Ukraine continues to affect many of the vital logistics and resources related to real estate. Problems with financing and highly skewed value-to-worth figures, mean people can’t do the deals they want to. This is all amplified by the fact that in 2020-21, we saw record deal volumes. But with the r-word looking like it is sticking around for another year, firms are not only cautious about pay outs, but in many cases have their hands tied. The take-home here is that bonuses won’t be bouncing back to 20-21 levels any time soon.
You might imagine that for me as a recruiter, a bad bonus season means good news. There’ll be lots of unhappy candidates, all looking for new jobs and sweeter packages, right? I know that for many in my field, that might be the case. But as this year’s bonus season approaches, I’d like to encourage my candidates, both existing and potential, to consider a different view point.
I’ve been in this game long enough to know that jumping ship at the first sign of a less-than-expected bonus might not always be the best response. I’ve seen too many candidates make knee-jerk responses to a disappointing pay out, move to anew firm and find that the grass is not necessarily greener, especially in such volatile market conditions. And while placing a new hire might be a short-term win for me, in the long run I know that what keeps the wheels of my business turning is not the quantity of candidates I place, but the quality. My clients want to hire people they can trust and invest in for the long-term, and sometimes that means weathering the storm of a low-key bonus season.
When the emails and calls start coming in over the next few weeks and months, I’ll be asking those candidates who think they might be better off elsewhere, to think about these key points:
- How has your bonus been communicated to you? If your firm has a strong culture of communication and respect, they will support you through the disappointment of a low bonus. How have you been told about it? Was it a surprise, were you told late in the day? In my experience it’s worth sticking with firms who handle their employees with care, because when the good times do roll, they take you with them.
- External influences aside, why do you think you have received a lower-than-expected bonus? Some employers use a zero-bonus as a way of clearing out what they see as dead wood. Be honest with yourself: have you done the deals and made the noise you said you would? How can you up your game in 2023?
- Are you otherwise happy in your work? And how long have you worked there? A working environment where you feel challenged and valued is priceless. While a low bonus is disappointing, it might be worth taking the big-picture view for now and weathering the storm.
If the answer to some of these questions is more about the number of zeros on the cheque, than it is about general job satisfaction, then I’ll be encouraging candidates to think long and hard before they make any rash moves.
So - my overall message is that 21-22 was kind of a weird year for everyone. If you like your job and can afford to put the financial disappointment of a low bonus down to experience, it might well be worth sitting tight for now and focusing on other aspects of your work and a longer term strategy.
If anything I’ve said here strikes a chord, and even if your bonus news is better than you’d hoped for, please do feel free to get in touch for a chat. The bonus landscape as viewed from here is always confidential, and can usually offer some fresh perspective on your next move, whenever that might be.
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