CHAPTER 5: RECRUITING AND SELECTING EMPLOYEES

Recruiting and selecting the right employees is crucial for higher performance and to avoid the costs of hiring
the “wrong” employee. Chapter 5 provides the foundation for knowing the processes used in recruiting and
selecting the right employees.

THE HIRING PROCESS

The hiring process includes:

1. Recruitment—The process of generating a pool of qualified candidates for a particular job; the first step
in the hiring process.
2. Selection—The process of making a “hire” or “no-hire” decision regarding each applicant for a job; the
second step in the hiring process.
3. Socialization—The process of orienting new employees to the organization and the unit in which they
will be working; the third step in the hiring process.

The Costs of Turnover

Good employees are worth 40% more than average employees. Furthermore, turnover costs about 25% of
salary and benefits. The following are major turnover costs:

 Separation — time spent for exit interviews and paperwork processing

 Recruitment — advertising and recruiter fees
 Selection — pre-employment testing and interviewing
 Hiring — orientation and training
 Productivity — vacancy costs and disruption
 Getting and keeping the best not only makes sense in terms of treatment of employees as customers
and the management process, but also makes good economic sense.

Challenges of the Hiring Process

The hiring process has its challenges. The most important of these are:

1. Determining which personal characteristics are most important to performance:

The characteristics a person needs to perform a job effectively are not always obvious. The knowledge,
skills, and abilities needed for jobs change as technological and other changes happen. Additionally,
people have differing opinions of desired characteristics for a particular job.
2. Measuring characteristics that determine performance:
Tests must be administered in some cases (assessing math skills, for example), for specific abilities. Many
tests yield different outcomes, some are better at predicting performance, and tests vary in administrative
costs.
3. The motivation factor:
Although many tests measure abilities, motivation is also a key principle in performance. The equation is
Performance = Ability x Motivation. Someone’s ability alone is not enough for performance. Likewise,
much motivation and little ability is also not enough for higher performance. However, motivation is very
difficult to measure. Many employers assess motivation in the interview.
4. Who should make the hiring decision?
There are two good reasons for letting HR run the staffing process. The organization must ensure that the
employment practices comply with legal standards and (2) letting HR run it is convenient. However,
 managers should be in on the process, especially if the individual will be working under him or her.
Additionally, many organizations are also including peers and subordinates in the hiring process.

AN APPORACH TO RECRUITMENT

Recruitment can be effective when it is viewed from the applicant’s perspective. Because applicants are
customers of the organization, the organization hopes that applicants make a buy decision about the job
opening. Thus recruitment is the opportunity to sell the job, the organization, and the community to the job
applicant. Here’s the approach to take when recruiting:

 Go to where the customers are: Go to social media like Facebook, Twitter, and LinkedIn.
 What do they want and what do you have to offer? People join organizations for a variety of reasons,
some of which include working atmosphere, career opportunities, work–life value, job characteristics,
and pay.
 Treat applicants like customers: Do your job applicants feel like they were treated as customers?
Applicants who have a positive experience are more likely to pursue employment with an
organization.

SOURCES OF RECRUITMENT

The most prominent sources of recruitment for organizations are:

 Current employees: Many companies have policies about job openings before recruitment to the
outside sources. Internal job postings give current employees the opportunity to move into the firm’s
more desirable jobs. However, the internal promotion also creates another job to fill.
 Referrals from current employees: Studies have shown that employees who were hired through
referrals from current employees tended to stay with the organization longer and displayed greater
loyalty and job satisfaction. However, one issue with this type of recruitment is that it causes those to
seek referrals that are similar to themselves, and thus fosters the lack of the diversity that an
organization needs, so this needs to be monitored closely.
 Former employees: A firm may decide to recruit employees who previously worked for the organization.
Typically, these people were laid off. Also, forming an online alumni network could be a simple and
cost-effective way to maintain a hiring pool of candidates.
 Former military: Since 2001, there has been a pool of former military personnel to hire. Some
organizations believe that hiring a former military person means hiring a more consistent job
performer.
 Customers: Customers can be a convenient and cost-effective source of employees. Because customers
are already familiar with the organization’s products and services, recruiting can capitalize on this
familiarity.
 Print and radio advertising: Advertising can be used both for local recruitment efforts and for targeted
regional, national, or international searches.
 Internet advertising: Employers are increasingly turning to the Web as a recruitment tool because
online ads are relatively cheap, more dynamic, and can produce faster results than newspapers. The
Web is also a convenient place for employee candidates.
 Career sites and social media: Thousands of career sites are available for recruitment and employment
information. The Web makes it easy for job candidates to seek jobs by industry, geographic location,
and job description. Social media sites such as Facebook, Twitter, and LinkedIn are also heavily used by
job seekers.
  Employment agencies: Many organizations use external contractors to recruit and screen applicants.
Typically, the employment agency is paid a fee based on salary offered to the new employee. Agencies
can be especially effective when the firm is looking for an employee with a specialized skill.
 Temporary workers: Provide employers the flexibility to quickly meet fluctuating demands. Bringing in
temporary workers enables employers to bypass the time-consuming hiring process of job interviews
and background checks.
 College recruiting: Most schools have a job placement service office that helps students make contacts
with employers. Many companies seek college placement services to find job candidates.
Furthermore, employers visit campuses and job fairs, and create relationships through internships.
 Non-traditional recruiting: Includes labour pools such as prisoners, welfare recipients, senior citizens,
and workers from foreign countries. These can be an excellent source of untapped labour for certain
jobs. Greystone Bakery in New York is a great example of a company that embraces a non-traditional
labour pool for its hiring.

RECRUITMENT
 External vs. internal candidates: Hiring externally gives the firm the advantage of fresh perspectives and
different approaches. Sometimes it also makes sense to hire externally, as it would be more expensive
to train or educate some skills and knowledge that is easier to obtain rather than recruit. However,
sometime new hires are perceived as “rookies” and not readily accepted by current employees.
Internal candidates offer less expensive (at times) means of recruitment and they are already familiar
with the company, product, and industry, which alone saves in “training/orientation” cost. However,
one of the biggest disadvantages of internal recruiting is not taking advantage of new and innovative
ways of thinking that may be needed to move the organization forward.
 Protected class: An important recruitment initiative is to actively attract and recruit women, minorities,
and persons with disabilities. A good rule of thumb is to target potential recruits through media or
recruitment methods aimed at the protected class. Going to the places where these people are most
likely found (professional organizations, colleges, etc.) is a good way to seek these candidates.
 Planning the recruitment effort: For an organization to recruit effectively, recruitment must be tied to
sound HRP. Calculating yield ratios and investigation into anticipated market conditions is prudent.
Additionally, revisiting the HRP numbers will ensure an organization stays on track with recruitment
planning.
 Planning the job search: In addition to the other means of finding a job, a good source to look is through
the Dictionary of Occupational Titles, the Occupational Outlook Handbook on the Bureau of Labor
Statistics website, and the O*Net Web site, to name a few.

SELECTION

Selection determines the overall quality of an organization’s human resources. The economic value of good
selection procedures is higher than most people realize. A variety of tools can be used in the selection process.
We’ll look at too important concepts for selection tools:

Reliability: The consistency of measurement, usually across time but also across judges. If a measure produces
perfectly consistent results, the measure is perfectly reliable. However, perfect reliability is rarely achieved.
Measurement almost always involves some form of error or “noise” or unreliability.

 Deficiency error occurs when a component of the domain being measured is not included in the
measure.
 Contamination error occurs when a measure includes unwanted influences.
Validity: The extent to which the technique measures the intended knowledge, skills, or ability. In the
selection context, it is the extent to which scores on a test or interview correspond to actual job performance.

 Content validity assesses the degree to which the content of the selection method is representative of
job content.
 Empirical validity (criterion-related: two types, either concurrent or predictive) is a strategy that
demonstrates the relationship between the selection method and job performance.
 Concurrent validity indicates the extent to which scores on a selection measure are related to job
performance levels.
 Predictive validity indicates the extent to which scores on a selection measure correlate with future job
performance.

Selection methods can be reliable, but not valid; however, selection methods that are not reliable cannot be
valid.

SELECTION TOOLS

Additional common methods of selection are the following:

Letters of recommendation—A content approach to considering letters of recommendation can increase the
validity of this selection tool. Assessment is done in terms of the traits the letter writer attributes to the job
candidate.

Application forms—Organizations often use application forms as a screening device to determine whether a
candidate satisfies minimum job specifications, particularly for entry-level jobs. The forms typically ask for
information regarding past jobs and present employment status.

Ability tests—Various tests measure a wide range of abilities, from verbal and qualitative skills to perceptual
speed. Cognitive ability tests measure a candidate’s capability in certain area, such as math, and are valid
predictors of job performance when the abilities tested are based on a job analysis. Physical ability tests are
used by police and fire departments and measure strength and endurance.

Personality tests—Assess traits of individual workers’ characteristics that tend to be consistent and enduring.
Personality tests have been widely used since the 1940s. The “Big Five” factors, now widely accepted in the
field of personality psychology, are:

 Extroversion—the degree to which someone is talkative, sociable, active, aggressive, and excitable.
 Agreeableness—the degree to which someone is trusting, amiable, generous, tolerant, honest,
cooperative, and flexible.
 Conscientiousness—the degree to which someone is dependable and organized and conforms and
perseveres on tasks.
 Emotional stability—the degree to which someone is secure, calm, independent, and autonomous.
 Openness to experience—the degree to which someone is intellectual, philosophical, insightful, creative,
artistic, and curious.

Honesty tests—Because employee theft is a serious and costly problem, honesty tests have become
important. Honesty tests are designed to identify job applicants who are likely to engage in theft and other
undesirable behaviour.

Interviews—Even though studies have shown that interviewers do not agree (biases and human judgment)
with one another on candidate assessments, interviews are still widely used today. We’ll now look at the
structured interview.
STRUCTURED INTERVIEWS

 Structured interviews—Job interviews based on a thorough job analysis, applying job-related questions
with predetermined answers consistently across all interviews for a job.

The three types of questions commonly used in structure interviews are as follows:
 Situational—these questions try to elicit from candidates how they would respond to particular
work situations.
 Job knowledge—the questions assess whether candidates have the basic knowledge needed to
perform the job.
 Worker requirements—these questions assess candidate’s willingness to perform under
prevailing job conditions.

INTERVIEWER DON’T´S

Whether employers choose structured or unstructured interviews, they need to make sure their interview
questions are not illegal. Following are illegal questions that should NOT be asked in an interview:

 Don’t ask applicants if they have children

 Don’t ask applicant’s age
 Don’t ask applicants whether they have a physical or mental disability
 Don’t ask for height or weight on an application
 Don’t ask a female candidate for her maiden name
 Don’t ask about citizenship
 Don’t ask applicants about their arrest records
 Don’t ask applicants if they smoke
 Don’t ask applicants if they are HIV positive or have AIDS

SELECTION TOOLS

Assessment centers—A set of simulated tasks or exercises that candidates are asked to perform. This is usually
done with manager candidates. These can be simulation types of assessments, work-related types of activities,
and scenario-based assessments (problem-solving).

Drug tests—Pre-employment drug testing typically requires job applicants to undergo urinalysis as a part of
routine selection procedures. These tests are generally more common in jobs that require special equipment
handling, but now these tests have extended to other types of jobs.

Reference checks—One of the best methods of predicting the future success of prospective employees
regarding their past employment record. However, note that there are some legal issues regarding giving out
information about an job candidate.

Background checks—Can be distinguished from reference checks and can include criminal background checks,
verification of academic achievement, driving histories, immigration status checks, and social security checks.
The primary reason for this type of check is to avoid negligent hiring charges.

Handwriting analysis—Graphology, the study of handwriting for the purpose of measuring personality or
other individual traits, is routinely used to screen job applicants in Europe, the birthplace of the technique.
Graphology is not yet considered a valid measure of performance.
Note that organizations use multiple methods to collect information on candidates and it’s now easier with the
Internet.

SUMMARY AND CONCLUSIONS

To summarize, hiring is a critical component of human resource function and there are many steps to recruit
and select effectively. The challenges to finding the right employee are many, but it’s very important to utilize
all effective and innovative tools in recruiting the most talented and desirable performers for the organization.