June 10, 2022

3 Reasons Why Students Renege on Offers

Reneges are costly. They not only leave companies with hundreds, if not thousands, of dollars in sunk costs, time, and resources, but they are also incredibly demoralizing. The excitement that follows the signing of an offer letter is dashed away by doubt, feelings of frustration, and one big gaping question: 

Why do students renege on offers for jobs and internships? 

Before we can talk about why students renege, it helps to understand the current trend. The good news is that the rate of reneges is not significantly higher: 12% in 2022 as compared to 14% in 2021 for internship offers, and 13% as compared to 16% for full-time offers. The not-so-good news is that the willingness of students to renege has increased, from 25% in 2021, to 35% in 2022.

So why do students renege? From our research, we know that students renege on offers for three main reasons: increased pay, a job that better fits their interests, and a role that they find more appealing. 

Better pay

The number one reason that students renege is because they receive an offer with higher compensation from a different company. For 71% of students who have reneged on an offer, better pay contributed to the decision. It was the most influential factor for 22% of those students.

“I reneged because I received a much better offer at a more established company. I don’t think the employer could have done anything to keep me from reneging since the other offer had over 3x better pay and a more structured intern program.” – Computer Science Major, 2024

Better fit for their interests

If a company offers them a position that is directly related to what they have been studying, a student will be more inclined to take that offer. Our research shows that 59% of students reneged on an offer because they found a job that was better suited to their interests.

“A few days after accepting the first job, I was offered a different job that I did not think I was going to get at all but that job was a lot closer to what I was interested in doing.” – International Studies Major, 2022

More appealing role and responsibilities

Of students who reneged, 51% of them said that they reneged because a more appealing role came after they had accepted their initial offer.

“When I reneged, it was something I did not do lightly, but I did see my future align more with the company I chose to go with instead. On top of that, I felt that I would learn more at this company because it had a more established internship program and could tell me what the day-to-day life of an intern looks like for them (as opposed to the other one that told me I would do whatever I was interested in).” – Chemical Engineer Major, 2023

What can recruiters and companies do to prevent reneges?

While these factors may seem to be out of the hands of recruiters and companies, there are some things you can do to mitigate the likelihood of a candidate reneging. Here are some ideas:

Advocate for candidates to be compensated fairly.

Regularly auditing compensation and benchmarking against the competition ensures your organization is staying competitive in the talent marketplace. If your recruiting team is seeing the pay as a primary reason for reneging or declining offers, it could be time to appeal to leadership to increase salary budgets. If increasing pay isn’t an option, make an effort to highlight other benefits offered that candidates should take into consideration. 

Communicate consistently and personalize the recruitment process.

Regular communication from employers makes an impact on the candidate experience. 80% of students would like to hear from employers at least once a month after accepting an offer and before starting their internship. 1 out of 3 students prefer communication at least 2-3 times per month. Offering the student updates and adding them to newsletter distribution lists, encouraging them to share their commitment to your company publicly on social media, and personalized notes are ways to reach out and add a human touch to recruiting.  More on Outreach Best Practices: Optimize Recruiter Outreach: Priorities Checklist

Give students time to decide.

Lastly, a majority of students, 64%, reported that pressure from an acceptance deadline was at least ‘somewhat impactful’ in their decision to renege. Rushed acceptance deadlines force students to either accept a guaranteed, but possibly less attractive, offer or gamble that they’ll eventually get a better offer. 

Understandably then, students choose the bird in hand, knowing that they could renege if a better offer comes along. So, give students time to decide and compare the offers that they get — in the end, it will be in both your interests.