If you’ve recently tried to hire a software engineer, you’ve most likely noticed the talent market in the U.S. is tight, and it’s likely to get tighter based on recent geopolitical machinations. You’re probably wondering what you can do to attract and hire talent in this competitive environment—and more importantly, what it will take to retain those employees.

Lucky for you, Vaco Seattle, formerly Greythorn, conducts an annual survey to help answer these questions. In Q4 2016, we asked software engineers primarily in the big data and open source space about their current roles, range of pay, and benefits. We also asked what is most important to them for job satisfaction, and what factors would make them look for a role elsewhere. Here’s what we discovered:

First Rule of Hiring: Don’t Hire!

The first rule of hiring is try to retain your best employees so you don’t have to do much hiring. Unfortunately, 50% of the tech professionals we surveyed said they were “likely” or “very likely” to change companies in the next 12 months. Software engineers know they’re in demand, so if you aren’t offering, or at least listening to what the market is offering, your employees will probably try to find it elsewhere.

Why Do Employees Leave?

When asked why they left their last position, 24% of respondents who left voluntarily* said career development/advancement was their primary reason. The second highest reason cited (by 15% of survey participants) was a new challenge and more interesting work. Essentially, 39% of people who voluntarily left their last organization were leaving primarily because they thought the grass was greener on the other side. Management/leadership came in third at 14%. Perhaps surprisingly, higher salary or bonus potential was the primary reason for only 9% of respondents.

To keep people happy, set out an internal progression career path and communicate it to your staff. Make sure they understand that as they progress, they’ll be given new and interesting challenges. Let them see how they’ll get to shape future projects.

What’s Love Got to Do With It?

Money isn’t the primary motivating factor for most software engineers, but it’s still important. Most tech professionals understand that there is more to the story than stark numbers. Nashville and San Francisco are going to have vastly different salaries for most positions – but on a relative basis, 42% of respondents are expecting an increase in salary of 0-5% at some point in the next 12 months. Nineteen percent are expecting a 6-10% increase. Only 13% are expecting an increase of more than 10%, while 26% are expecting no bump at all.

Salary bumps are more than just extra dollars in a paycheck—they’re a way of showing an employee that they’re valued. To keep employees happy, consider balancing salary increases to career progression and development, and provide reasonable increases – between 3% and 10% – on a regular basis.

Show Me the Money

Money may not be a big motivator for those who are pleased in their current jobs, but when someone is considering a new job, higher salary was selected most often as a top three priority; 60% of our survey said it was in their top three priorities. Career development/advancement and new challenge/more interesting work came in second and third at 51% and 50%, respectively. However, both were selected as the primary priority someone considers for a new job more often than salary. No other response topped 30%, and only work-life balance topped 25%.

When courting talent to join your organization, sell them on the interesting work and career development – e.g. a mentoring program and stats about promotions from within the company – since that is what will keep them around once they’re hired. Do so in conjunction with their compensation package to highlight the entire picture you’ve created for their role.  

Perks & Benefits

In terms of benefits and perks, we asked our respondents which were the most vital on a 1-4 scale; vital, fairly important, somewhat important, and not important. Importance rating was weighted on a percent scale out of 4. The most desired benefit/perk based on importance rating was medical insurance at 90%. Dental insurance and 25+ days of paid time off/holiday were listed as vital, and earned 78% and 80% importance ratings, respectively. Remote working, 401K match, and vision insurance also all ranked highly on importance ranking, but none topped 30% from a percent of respondents saying they were vital. Medical insurance, dental insurance, and a strong PTO policy seem to be relatively par for the course in benefits packages. Call them out at some point in the hiring process, but treat them as table stakes because you won’t get a high quality hire without them.

But how do you get past the table stakes and stand out to sought-after software engineers? Whether you’re trying to attract or retain talent, it’s important to know the difference between what elements tech professionals rated as important, and how many of them said those elements were part of their current package.

The top three biggest disparities were equipment reimbursement (53% importance rating but only 21% of respondents currently had); miscellaneous services like dry cleaning, massage, etc. (35% importance rating; 9% currently had); and a subsidized meal plan (38% importance rating; 13% currently had). As you can see, the importance rankings of each of those three is not nearly as high as the benefits listed above, but they can be a definite selling point and a way to stand out.

Let the Rubber Hit the Road

If you want to retain talent, make sure employees see career development/advancement opportunities, are kept engaged through new challenges and interesting work (I know, easier said than done), and are paid fairly. To attract new talent, the same three things apply. We recommend finding a way to emphasize them in the process with hard facts, not anecdotes.

If you’re interested in seeing the results of our survey yourself, you can request a copy of our market report here.

* Excludes those laid off and who left their last role due to end of contract / assignment