Turnover & Retention
Predicting Turnover and Performance
As the poor economy and the associated decrease in employee raises and bonuses make it more difficult to retain high-performing employees, organizations need to make pre-hire determinations of which candidates are most likely to stay with the organization. Finding indicators for both performance and turnover enables organizations to use fewer resources when selecting applicants. But, based on the idea that past behavior is the best indicator of future behavior, what are the most useful predictors for high performance and low turnover?Pre-hire Predictors
Are pre-hire predictors of turnover also effective indicators of work performance? Several indicators, such as biodata (biographical data) and pre-hire attitudes, have been explored for the purpose of answering that very question. In particular, three types of information are especially strong indicators of job performance and turnover.- Biodata– predictors that represent pre-hire embeddedness in the organization (employee referral; number of friends and family) and habitual commitment (tenure in prior job; number of jobs in last five years)
- Pre-hire attitudes– includes the applicant’s self-confidence and confidence with decisions, as well as the applicant’s desire for a job and pre-hire intent to quit
- Personality traits– Conscientiousness (being dependable and reliable) and Emotional Stability (ex. Individuals who have low emotional stability tend to have negative perceptions of themselves and their environment.)
Turnover Decisions and Job Performance
Some notable indicators of which employees are likely to remain working for a company six months after hire include: pre-hire embeddedness, habitual commitment, personal confidence, motivation for employment, conscientiousness, and emotional stability. Further, beyond the period of six months post hire, up to two years later, the remaining two indicators for voluntary, avoidable turnover are conscientiousness and emotional stability. The number of jobs held over the previous five years was a better indicator of early turnover, whereas tenure on the most recent job was more predictive of early job performance. The good news is that most turnover decisions are “functional,” meaning that those employees who tend to stay in an organization tend to be the better performers.Practical Implications
Learning how to do the job (conscientiousness), meeting the “right” people from whom to learn about the organization (embeddeness), and figuring out the power structure of the firm and the organization’s goals and values are important to employee success and lead to lower turnover during the early stages of an employee’s adjustment to an organization. While so many of the factors listed above serve as suitable indicators for high performance and low voluntary, avoidable turnover, hiring managers should mainly consider them when hiring for a short-term or seasonal position, due to the fact that most of the indicators are useful for six months post-hire. Ultimately, personality (conscientiousness and emotional stability) is a useful indicator of voluntary, avoidable turnover up to two years after hire. Further, a personality assessment enhances the usefulness of biodata when the two are used together. Hiring managers should note that with the exception of personality, the importance of all other predictors weakens over time.Kandace Waddy
DeGarmo
This was a summary of the research and practice implications from: Barrick, M. R., & Zimmerman, R. D. (2009). Hiring for retention and performance. Human Resource Management, 48(2), 183-206.