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News flash: Better employees give better results
Though it may sound stunningly obvious, a group of University of South Carolina researchers have concluded that hiring better employees gives better results, at least when it comes to selling.
According to Rob Ployhart, an associate professor of management in USC’s Moore School of Business, “Every hiring manager knows that employing better employees is going to lead to better results. The reality, though, is that many retailers maintain a certain amount of skepticism about the value of investing in frontline service employees. With high turnover rates, a problem many HR managers face, and few apparent differences among applicants, many organizations simply opt to fill their sales and clerical staffs with enough warm bodies to meet their staffing demands,” he said.
In a study to be published in the Academy of Management Journal, Ployhart and his team examined 114,198 people employed by a major retailer. They analyzed employment applications and individual test scores using scientifically proven practices to determine job-related knowledge, skills, and abilities of the employees. The tests were based primarily on personality, situational judgments, and experience and gave an indication of whether applicants had the abilities to perform the retail job.
Ployhart noted that industrial-organizational psychologists have a track record of making good decisions based on employment tests. Unfortunately, he said, little of this evidence-based knowledge makes its way to HR practitioners, who, too often, use hiring procedures that are not scientifically valid.
In the study, stores with a greater percentage of employees with higher test scores outperformed those stores with workers who had lower scores. In fact, stores with the higher skilled employees averaged about $4,000 of sales per employee per quarter more than those stores with employees whose test scores ranked lowest.
Online job listings show economy remains in the doldrums
Online advertised vacancies declined 506,000 to 3,355,000 in January, according to The Conference Board Help-Wanted Online Data Series. The January loss, combined with a similar sharp drop of 507,000 in December, results in a decline of over 1 million advertised vacancies, or 23%, in the last two months.
“If there is any bright spot, it is that there are still well over 3 million advertised vacancies,” notes Gad Levanon, senior economist at The Conference Board. In January, labor demand declined in all four regions of the nation — the Northeast, South, MidWest and the West with the most populous states in all of the regions posting declines.
In January, there were 348,500 online advertised vacancies for management positions — a decline of 34% from last January’s level. Computer and mathematical job ads were down 104,200 over the same period. Other categories showing severe declines included architecture and engineering (–56,100).
In January, 50 of the 52 metropolitan areas for which data are reported separately posted declines in the number of online advertised vacancies from last January. The only two gainers were Honolulu with 9,900 ads — well above levels of last year (16.8%); and Oklahoma City, with 14,100, a gain of 500 ads compared to last year.
Believe it or not, there were two metro areas in which the number of advertised vacancies exceeded the number of unemployed: Salt Lake City and Washington, D.C. On the other hand, metro areas in which the respective number of unemployed is substantially above the number of online advertised vacancies are Riverside, Calif., where there are more than seven unemployed people for every advertised vacancy, Detroit (5.3), Miami (3.4), Tampa (3.3), Sacramento (3.3), Los Angeles (3.2), and Atlanta (3.1).
Supply/Demand rate data is for Nov. 2008, the latest month for which unemployment data are available. The Conference Board Help-Wanted Online Data Series measures the number of new, first-time online jobs and jobs reposted from the previous month on more than 1,200 major Internet job boards and smaller job boards that serve niche markets and smaller geographic areas.
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Edited by Leland Teschler