Students Should Take Cover From Exploding Offers

In the current white-hot job market, new college grads may have the upper hand, but recruiters are trying to even the score.

Recent grads and college placement personnel say more companies are using"exploding offers" job offers that expire after a short time. If the student doesnt accept the offer within that time, its withdrawn. Other companies proffer fat signing bonuses that decrease with every day or week that passes. Eventually, the bonus disappears, along with the job offer. Other "vanishing bonuses" may be the offer of a particular training program or office location.

Career services pros fret about exploding offers. "It puts the student in a horrible position," says Jaime King, associate director of MBA services at the University of Texas in Austin. "But I understand why theyre doing it. Its a very hot market, and companies are under a lot of pressure to increase their yield rates. Theyll do it however they can. Some companies just dont care how it will affect their relationship with their new employee."

Protecting Students

Schools often try to place some kind of limit on exploding offers. Ann Browning, associate director of recruiting at the Kellogg School of Management at Northwestern University, says Kellogg plans to insist that firms agree to give students until mid-January or three weeks, whichever comes later, to decide on a job offer. "Even with that policy," says Ms. Browning, "theres not a lot we can do. If a company ignores our guidelines, we have no recourse. Were not going to throw a company off campus because they give exploding offers. Thats not fair to our students."

Amy Yamashita, director of recruiting at the Career Management Center at UCLA, says the school does confront firms that give exploding offers, "but they will often say Look, Amy, its very competitive, and were losing the talent."

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Ms. Yamashita says that not only are exploding offers more common, theyre "getting more creative." A current recruiting ploy is the "non-offer," in which a firm asks a candidate whether or not he would accept an offer, were it to be extended.

"They are very clever," explains Ms. Yamashita. "If you say that you want time to think about the offer, theyll say We will only extend offers to serious contenders. We want to be your first choice. If you say youll accept an offer if its given, theyll give you one, and then you have no choice. Its a salesmans technique."

Expanding Strategy

Traditionally, investment banks have relied on exploding offers. However, saycareer-center directors, other kinds of companies are getting into the act. "Brand companies have started to give exploding offers in a big way this year," says Ms. Browning. "Thats because consulting firms are hiring the people who might traditionally go to brand management. We had two brand companies ask students for commitments within 24 hours."

Consulting firms tend to give candidates a long time to decide, but they "put the pressure on in other ways," says Mr. King. "Many consulting firms will give students decreasing bonuses theyll have a month, then the bonus begins to drop. That doesnt sound like a short amount of time, but students are now getting offers almost from the minute they return to campus. So if you get an offer in October, you dont have the luxury of checking out other firms as much." Mr. K