Employers are hiring all wrong

Employers are hiring all wrong

Most employers don’t know whether their hiring methods actually produce good hires, or how much time or money it costs to fill jobs. They don’t review the outcomes of their methods.

“Obsessed with new technologies and driving down costs, they largely ignore the ultimate goal: making the best possible hires,” says Wharton labor researcher Peter Cappelli, in the Harvard Business Review article, “Your Approach to Hiring Is All Wrong.”

What this means to you

Go around the recruiting and hiring systems employers want you to use, because they don’t work.

Summary

Cappelli says the root cause of most hiring is drastically poor retention. You’re most likely to change jobs and employers because your current employer is unlikely to promote you and provide new opportunities internally. This creates churn in the labor market and, ultimately, results in tremendous costs to fill jobs — an average of $4,129 per job in the United States.

Excerpts

Where are the hiring metrics?

Only about a third of U.S. companies report that they monitor whether their hiring practices lead to good employees; few of them do so carefully, and only a minority even track cost per hire and time to hire. Imagine if the CEO asked how an advertising campaign had gone, and the response was “We have a good idea how long it took to roll out and what it cost, but we haven’t looked to see whether we’re selling more.”

Failure to develop employees

In the era of lifetime employment, from the end of World War II through the 1970s, corporations filled roughly 90% of their vacancies through promotions and lateral assignments. Today the figure is a third or less. When they hire from outside, organizations don’t have to pay to train and develop their employees. Since the restructuring waves of the early 1980s, it has been relatively easy to find experienced talent outside. Only 28% of talent acquisition leaders today report that internal candidates are an important source of people to fill vacancies—presumably because of less internal development and fewer clear career ladders.

More is bad, so scare away the applicants

Recruiting and hiring consultants and vendors estimate that about 2% of applicants receive offers. Unfortunately, the main effort to improve hiring—virtually always aimed at making it faster and cheaper—has been to shovel more applicants into the funnel.

Much better to go in the other direction: Create a smaller but better-qualified applicant pool to improve the yield… If the goal is to get better hires in a cost-effective manner, it’s more important to scare away candidates who don’t fit than to jam more candidates into the recruiting funnel.

Hiring good employees

How to determine which candidates to hire—what predicts who will be a good employee—has been rigorously studied at least since World War I. The personnel psychologists who investigated this have learned much about predicting good hires that contemporary organizations have since forgotten, such as that neither college grades nor unstructured sequential interviews (hopping from office to office) are a good predictor, whereas past performance is.

Since it can be difficult (if not impossible) to glean sufficient information about an outside applicant’s past performance, what other predictors are good? … There is general agreement… that testing to see whether individuals have standard skills is about the best we can do… Only 40% of employers, however, do any tests of skills or general abilities, including IQ. What are they doing instead? Seventy-four percent do drug tests, including for marijuana use…

The advice on selection is straightforward: Test for skills. Ask assessments vendors to show evidence that they can actually predict who the good employees will be. Do fewer, more-consistent interviews.

HR vendors: Fresh & cool but unvalidated

Be wary of vendors bearing high-tech gifts. Into the testing void has come a new group of entrepreneurs who either are data scientists or have them in tow. They bring a fresh approach to the hiring process—but often with little understanding of how hiring actually works… These vendors have all sorts of cool-sounding assessments, such as computer games that can be scored to predict who will be a good hire. We don’t know whether any of these actually lead to better hires, because few of them are validated against actual job performance.

Wild HR technology

When applications come—always electronically—applicant-tracking software sifts through them for key words that the hiring managers want to see. Then the process moves into the Wild West, where a new industry of vendors offer an astonishing array of smart-sounding tools that claim to predict who will be a good hire. They use voice recognition, body language, clues on social media, and especially machine learning algorithms—everything but tea leaves. Entire publications are devoted to what these vendors are doing.

News I want you to use

What all this tells us is that employers suck at hiring, and if you follow the rules the Employment System itself is likely to prevent you from landing a new job — because it doesn’t work. Go around!

Employers don’t assess outcomes of hiring methods

It’s impossible to get better at hiring if you can’t tell whether the candidates you select become good employees. If you don’t know where you’re going, any road will take you there. You must have a way to measure which employees are the best ones.

Why is that not getting through to companies? Surveyed employers say the main reason they don’t examine whether their practices lead to better hires is that measuring employee performance is difficult.

Treat your job search like a business task

Like the sales manager who asks, “Is what we’re doing generating sales?”, you must learn to ask, “Is what I’m doing getting me job offers?”

Your boss checks to see whether the work you are doing yields the expected results — that’s a business task.

  • Pursue companies carefully — don’t chase job postings
  • Look for managers who know how to recruit and hire
  • Control your interactions with every employer

Just because employers behave like dummies when it comes to hiring doesn’t mean you have to play along or encourage them. Apply your business skills to the business task of getting the right job.

Organizations that don’t check to see how well their practices predict the quality of their hires are lacking in one of the most consequential aspects of modern business.

The truth hurts employers, but it hurts job seekers even more. I’ve only touched on what you can do to capitalize on Cappelli’s findings and suggestions. How can we use this news?

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Job Assessment Tests: Don’t jump through hoops

In the October 3, 2017 Ask The Headhunter Newsletter, a reader doesn’t like doing assessment tests for employers who put no skin in the game.

Question

I really enjoy your direct and honest feedback to job hunters each week. I’d like to get your thoughts on jobs that make you do “assessment tests” to prove you are qualified.

assessment testsI do not work in the tech field where I know these are common. I’ve worked in marketing for 15 years, won awards, and worked for some top-name businesses. But recently I have encountered many recruiters that want you to prove your worth.

My favorite was for a company in the San Francisco Bay Area that needs to fill a marketing and web content position. Two hours before the phone interview, the marketing director sends me an e-mail saying that I need to prove my research skills and she will send me a question 10 minutes before our interview time. I have to research the question and have it submitted before the interview.

I was ready to walk but did it just to see if I could. (I succeeded). After the talk, I was unimpressed with her abilities and withdrew my application.

Recently, during my first in-person interview for another job, I was asked to write a five-page press release by the next day. I politely told the manager that my extensive work experience speaks for itself and I would be happy to send links to my previous press releases. She said that wasn’t good enough and I said, “I’m withdrawing my application.”

As you can tell, I’m ready to walk away from imposing situations like this that, for the most part, waste your time. What is the proper way to say “no” to these assessments? Thanks!

Nick’s Reply

My compliments for walking away from these kinds of abusive hurdles. Such employers undoubtedly think what they’re doing is a clever “pre-assessment” of job applicants. That is, they want to assess whether it’s worth their time to meet and assess you. They lay the burden on you, while they avoid putting their own skin in the game.

My guess is they add this step because some HR consulting firm charged them a bundle for “best methods” in recruiting. But there’s nothing “best” about abusing the job candidates those same employers complain are in short supply! Talk about trying to appeal to a candidate!

Assessment tests are often bogus

For an in-depth look at this topic, see Dr. Erica Klein’s Employment Tests: Get The Edge.
Job assessment tests come in many flavors. Tests and assessments can be useful tools for employers and job seekers. But more often than not, they’re misused. Some assessment methods are transparently ridiculous and unreasonable — and they’re not assessments at all. They’re bogus.

I think the way you’re dealing with unreasonable demands is just fine. And I don’t think anything you say to employers or recruiters is going to make them stop insisting that you jump through hoops, participate in totally one-sided “interviews,” and do free work. These employers have established a policy and a process. You’re not likely to change any of it. But it may be fun to make a point to them — a point that may hit home after they lose lots of good job applicants to their competitors.

I love your story about the marketing director. I wonder if she instructs her company’s salespeople to pre-assess potential customers by making them submit a five-page statement about “Why I’m worthy to listen to your sales pitch.”

But you asked me how to say no to these “assessments.”

How to Say It

When you’re asked to jump through hoops that you think are unreasonable, be ready to respond. Here are my suggestions about how to say it, ranked by snarkiness. Decide how far you want to go.

Meet or beat it.

“I’d be happy to invest my time to meet with you so we can determine whether we should work together. If there’s serious mutual interest, I’d be glad to show you how I’d to the job profitably. But without a corresponding investment of time from a serious employer, it’s just not prudent for me to do what’s essentially a one-sided assessment. I’m currently in discussions with three other employers and I expect to choose one in the next X days. If you’d like to meet to explore working together, I’d be glad to come in on one of these dates and times: [list 2 or 3 dates]. If those are not convenient, please suggest some others and I will look forward to talking shop.”

That’s pretty assertive, but so’s an employer’s demand that you do work before just a phone interview. I’m a big believer in showing how you’ll do the work to win the job — in a face-to-face meeting. But if the employer isn’t investing its own time and effort, it’s presumptuous of them to expect you to do so.

Pay me to do your job.

Sometimes it helps to put a price on what the employer is demanding:

“Just as I’m sure you don’t charge prospective customers to do a sales call, or to provide product samples for their evaluation, I don’t charge for interview meetings or samples of my work. I’d be more than happy to meet with you. But if you want me to work solo while you attend to other matters, my hourly rate is $X. If you’re willing to invest a couple of hours of your time, I’ll invest mine, too — no charge.”

I’ll do it if you’ll do it.

Sometimes it helps to put the shoe on the employer’s foot. You’ll win only the most honorable fans with this, but please understand that this is the shoe the employer is trying to get you to walk miles in:

“Attached is a psychological assessment test to be completed by the manager I’d be working for if your company were to hire me. If you’ll please have him or her complete it, to help me ensure I’d be working for a properly qualified manager, then I’d be glad to take your assessment, too. Since you already have my resume, kindly forward a copy of the manager’s resume so I can review it. Since time is of the essence, please be aware that I’m at the offer stage with two of your leading competitors.”

I don’t do tricks.

This one’s pretty snarky but, hey, would you go on a blind date with someone who’s not going to show up?

“An interview is called that because inter- means between, mutually, reciprocally, together — not one-sided. I’m looking for a good employer, and that means one that respects me enough to invest time together and reciprocally. I don’t jump for treats. Do you really have so many great candidates that you can afford to ask them all to do tricks before you’ll interview them? I’m ready to interview you if you’re ready to interview me.”

You’re not worth my trouble.

This one requires no explanation.

Talk to the hand.

Why do they do this?

You know such jump-through-the-hoop job assessments are inappropriate and usually offensive. So do I. Why don’t employers know it?

It’s pretty simple. These are employers that don’t know how to recruit job candidates. They want you to do the work, preferably with no investment on their part. These employers want you to incur costs before they do. They want you to pay for hiring managers’ (and HR’s) ineptitude. They’re all telling you one thing: “You don’t want to work here because we have no idea how to hire.”

What are the most ridiculous or offensive assessment tests you’ve been asked to jump through? How have you responded? Is there a way to say no that keeps you in the running? If you’re an employer, how do you justify asking candidates to perform — before you invest any time in them? (That’s not a loaded question. We’d really like to know.)

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Employment Tests: Get The Edge | NEW BOOK!

In the October 8, 2013 Ask The Headhunter Newsletter, a job seeker worries about taking employment tests:

I’m going on an interview shortly. I was told that prior to receiving an offer there would be some testing. I doubt there are any tests that relate to the job content of this particular job. What other kinds of tests are typically given, and what should I look out for?

Nick’s Reply

employment testsEmployers routinely administer tests without notifying candidates what tests they’re going to give them. That’s not acceptable. You should ask the employer in advance exactly what tests will be administered to you.

Employment testing is a complex issue — there are ethical, legal, and practical considerations. I’ve got my own opinions, but I turned to an expert in employment testing for help in answering your question.

Erica Klein is a Ph.D. Industrial Psychologist who has worked in the field of strategic, competency-based selection and assessment since 1998. She develops and administers employment tests, and she’s taken virtually every kind of employment test herself.

Dr. Klein explains that, when they’re administered appropriately, “Tests can help employers predict who is likely to be successful in a job. In combination with interviews and experience and education screening, tests can provide employers with additional predictive value.” In other words, such tests can actually help you land the right job and avoid the wrong one.

Klein is also the author of Employment Tests: Get The Edge — a new PDF book from Ask The Headhunter. Dr. Klein steps out of her normal role interpreting research for the benefit of employers, to advise job seekers who take tests.


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An article Dr. Klein wrote for the ATH website has been so popular that I asked her to write this 36-page PDF book for the ATH bookstore. It’s the only book that you’ll find that covers all 5 major types of employment tests — written to help job seekers.

Order Employment Tests: Get The Edge now!

 

 


What kinds of tests might you be given? Erica Klein says, “The most common pre-employment test is a combination of a cognitive ability (intelligence) test and a personality test. Other common types of tests include job samples, integrity tests and situational judgment tests.”

My concern is where a test comes from, because few employers actually create their own.

Klein explains: “Many employers purchase off-the-shelf cognitive ability and personality tests. If you want to research the tests ahead of time you can ask the employer which tests they use. Many employers will tell you but some may not. Even without specific information about the test you can still learn a great deal by researching the general structure, content and purpose of these tests.”

She offers four testing tips from her book:

  • Know your rights. You don’t have to take a test, but if you don’t you will probably not be considered for the job.
  • Learn as much as you can about the tests you will be taking so you can perform your best and avoid common mistakes.
  • Approach testing like an athletic event with proper training, rest and nutrition.
  • Ask for feedback about your test results. Use the results to learn more about yourself and refine your job search.

Clearly, it’s up to you to ask questions and to do your own homework. But you’re not alone. The American Psychological Association (APA) has established stringent codes regarding the administration and interpretation of such tests. These codes dictate that the tests must be valid and reliable, and the results of the tests must be properly interpreted and shared with you.

So, don’t walk into a testing situation blindly. If you want to perform at your best, you need to know what to expect, and you should prepare in advance. If a company doesn’t abide by the APA rules, I’d decline to be tested. You’re not back in grade school, where tests are forced on you. You’re an adult, and you are not required to take any test unless you want to.

You also need to know whether and how the results will be stored — it’s a privacy issue. If you’re uncomfortable, ask questions before you consent until you are satisfied the testing will be conducted properly and how it will be used to judge you.

While some companies administer tests in ethical, appropriate ways, others have little idea what they’re doing–and that puts you at risk. Before you let anyone poke and prod at your personality, make sure you understand the potential consequences. All job hunters should visit the APA’s website to learn about their rights: Rights and Responsibilities of Test Takers: Guidelines and Expectations.

Did you know you have rights when it comes to employment testing? How do you prepare for employment tests? Do employers explain to you the tests and testing procedures in advance? Has your performance on a test ever cost you a job opportunity?

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