Pre-Hire Assessments: How Science Is Helping to Reduce the Cost of Bad Hires

Neither hiring managers nor human resources professionals need to be reminded of the immense costs of bad hires. The Bureau of Labor Statistics estimates that a hiring mistake costs approximately 30% of the individual’s annual salary. Other sources peg the costs much higher after including lost productivity, lowered team morale, and potential customer service implications.

Of course, the goal of every hiring organization is to continually improve their hiring processes so that the costs associated with bad hires are reduced. Fortunately, the application of decades of scientific study has helped to create tools and approaches that allow hiring organizations to better forecast a candidate’s fit for and likely success within a specific job.

Some of the most influential organizational psychology work in the modern era was the research of Frank L. Schmidt, professor of organizational psychology at the University of Iowa, and John E. Hunter, professor of psychology at Michigan State University. Importantly for hiring organizations, their work revealed new understanding of the factors that most accurately predict hiring success.

On the basis of meta-analytic findings, their work summarized what 85 years of research in personnel psychology has revealed about the validity of 19 different selection methods that are or were commonly used in making hiring decisions.

Schmidt and Hunter’s work found that some factors, like job experience and years of education—key factors historically and presently used to make hiring decisions—are not reliable indicators of success.

As the chart below illustrates, general mental ability (GMA) assessments paired with work sample tests, integrity tests, conscientiousness tests, and structured job interviews are the most powerful tools in predicting a successful hire.

Personnel Measure Validity GMA + Listed Measure
General Mental Aptitude Tests (GMA) 0.51
Work Sample Tests 0.54 0.63
Integrity Tests 0.41 0.65
Conscientiousness tests 0.31 0.60
Employment interviews (structured) 0.51 0.63
Employment interviews (unstructured) 0.38 0.55
Job knowledge tests 0.48 0.58
Job tryout procedure 0.44 0.58
Peer ratings 0.49 0.58
Training & experience behavior consistence method 0.45 0.58
Reference checks 0.26 0.57
Job experience 0.18 0.54
Biographical data measures 0.35 0.52
Assessment centers 0.37 0.53
Training & experience point method 0.11 0.52
Years of education 0.10 0.52
Interests 0.10 0.52

 

The importance of conscientiousness and knowledge, rather than experience, comes to light. Additionally, integrity tests within the scope of this research primarily measured conscientiousness, further reinforcing the importance of this trait. The research found that after controlling for mental ability, employees who are higher in conscientiousness develop higher levels of job knowledge, primarily because highly conscientious individuals exert greater effort and spend more time “on task.” This job knowledge, in turn, results in higher levels of job performance.

Although higher levels of job knowledge is definitely a strong predictor of hiring success, years on the job (experience) does not necessarily equate to higher levels of job knowledge, making job experience an unreliable predictor of success.

Knowing that high levels of GMA, integrity, conscientiousness, and job knowledge are key predictors of a successful hire, how can we best assess these attributes during a hiring process? Thankfully, Schmidt and Hunter’s scientific work, along with the work of many others, has been applied to the creation of pre-hiring assessments designed to measure these key attributes.

While there are thousands of assessments on the market, the following sampling lists some of the established assessments proven to predict accurately the traits Schmidt and Hunter’s research found to be so important—GMA, conscientiousness, and integrity.

Wonderlic Personnel Test

The Wonderlic Personnel Test is a commonly used cognitive ability assessment that measures GMA including the prospective candidate’s ability to understand instructions, learn, adapt, solve problems, and handle the mental demands of the position.

The Watson-Glaser

The Watson-Glaser was initially developed in 1925 by Goodwin Watson and E. M. Glaser, a professor and student at Columbia Teachers College. Although this test has been through a number of revisions, for many years it has focused on assessing critical thinking.

Bennett Mechanical Comprehension Test

Bennett Mechanical Comprehension Test is one of many assessments on the market that is focused on assessing aptitude for a specific type of job. This assessment is commonly used when hiring for mechanical and industrial positions and has been found to be good at assessing spatial perception and mechanical reasoning abilities. In addition, it assesses aptitude for learning mechanical processes and tasks.

Criteria Cognitive Aptitude Test

The Criteria Cognitive Aptitude Test is another commonly used pre-employment aptitude test that measures an individual’s ability to solve problems, digest and apply information, learn new skills, and think critically.

16pf Questionnaire

Dr. Raymond Cattell published the first edition Sixteen Personality Factor (16pf) Questionnaire in 1949. The 16pf Questionnaire is designed to assess a candidate’s full personality. Many of the characteristics studied within the assessment revolve around conscientiousness and integrity, which have been found to be so important. Many human resources professionals favor the 16pf Questionnaire because the assessment focuses on practical situations rather than general personality traits.

The Caliper Profile

Another very commonly used assessment, The Caliper Profile measures personality traits—from assertiveness to thoroughness—that relate to key skills needed on the job. Like the 16pf Questionnaire, the Caliper Profile focuses on practical situations and discovering what truly motivates a candidate, rather than general personality characteristics.

Gallup StrengthsFinder

A number of years ago, research conducted by Gallup suggested that personality assessments focused too much on weaknesses, rather than assessing strengths. Questions in this assessment work to measure 34 positive traits the candidate might possess and identify the top five strengths (of the 34) that best represent the prospective employee.

While even the best hiring practices will not completely eliminate hiring mistakes, we can learn a great deal from the immense amount of work and study that has been done in the fields of personnel and organizational psychology. Validated pre-hire assessments, like the ones mentioned in this article (and this list is far from exhaustive) are robust tools to more accurately—and arguably more scientifically—predict the likelihood of a candidate’s success.

Scientific study will continue to reveal new understanding of how to best assess ability and motivation, so that success can be even more accurately forecasted. Utilizing these findings, leading assessment companies and other experts in the field will continue to develop innovative new solutions to help managers avoid costly hiring mistakes.

Sources:

  1. Bureau of Labor Statistics, U.S. Department of Labor
  2. “The Validity and Utility of Selection Methods in Personnel Psychology: Practical and Theoretical Implications of 85 Years of Research Findings,” Dr. Frank L. Schmidt and Dr. John E. Hunter
  3. “What Do Personality Tests Really Reveal?,” Dori Meinert, Society of Human Resource Management
  4. “Can Aptitude Tests Really Predict Employee Success?,” Georgina Clatworthy, HumanResources.com
  5. “Pre-Employment Testing: A Helpful Way For Companies To Screen Applicants,” Lisa Quast, Forbes
  6. “4 Tips to Best Use Assessments for Hiring,” Entrepreneur
  7. “5 Tips for Using Technical Assessments In Interviews,” Rob Lambert, LinkedIn Pulse
  8. www.16pf.com
  9. www.wonderlic.com
  10. www.thinkwatson.com

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