First from the January 2011 NABE Industry Survey for the USA:

• “The number of firms expressing positive hiring plans is at a level not seen in over a decade – a sign of improving labor-market dynamics.”
• “Employment continues to improve with 34% of firms reporting larger workforces compared to only 13% a year ago. The share of firms cutting jobs shrank, from an average of 13% over the past three quarters to 6% annually. ….. The hiring outlook for the next six months also looks more robust – 42% of respondents indicated their firms will be increasing employment, up from 39% last quarter and 29% in January 2010.”

Second from the Canadian HR Reporter, January 31, 2011:

• “Canadian employers continue to experience steady job growth across multiple industries and the trend is expected to continue in 2011.
• “According to a survey of 227 hiring managers 32% of employers plan to hire full-time employees, up from 29% I 2010 and 18%in 2009.

And third (and most reliable), from Ira S. Wolfe, an authorized Prevue Distributor:

• “As a provider of pre-employment and leadership assessments, we just don’t get calls if employers are not in the throes of hiring. But 2010 was a banner year, with the month of December being the best and busiest since I started the business in 1996.”
• “Advertising on one of the largest US employment sites has increased a whopping 74% since December 2009. That’s an increase of 2.0 million job openings in the past twelve months…As promising as these figures are, the future might even be brighter. According to another article in the Wall Street Journal more than 80% of job openings are actually unlisted, since most companies will try to promote from within or rely on employee referrals.”

So the general climate for development looks good – but now what is the forecast for the use of assessments in this fertile environment? Besides looking at worldwide economic trends, we also keep a close eye on developments and trends in the HR management world and particularly in respect of the use of assessments. A very recent article from the well respected Dr. Charles Handler made us think he was sitting in our business planning meetings over the past two or three years. We were pleased if not a bit smug to see that our plans for 2011-12 for the introduction of a comprehensive Prevue Hiring System accords almost exactly with Dr. Handler’s forecast that:

• “….Assessment is being integrated into talent management solutions and applicant tracking systems-type solutions. So, we are continuing to adapt and evolve in a way that sees assessments as one piece of a bigger picture.”
• “…. The reality is that assessment is just one part of a much bigger picture when it comes to the hiring process…. The real challenge is in the continued integration of assessment data into the rest of the information used to make a hiring decision. I personally am really ready to see firms begin to take a bigger-picture, process-oriented approach in which assessment is an integral part of a big picture strategy…..”

The introduction of the Prevue Hiring System will put Prevue on the leading edge of this trend. We had concluded in 2009 that psychometric assessments, along with most stand-alone hiring tools and services would need to be incorporated into more comprehensive hiring solutions. You will be hearing a lot more on this subject as we begin to roll out the Prevue Hiring System through 2011.

Prevue is definitely looking forward to 2011!

Written by Ken Danderfer
February 5, 2011

WHY ORGANIZATONS ARE USING ASSESSMENTS

Over 80% of study participants use assessments in the hiring process. The following graph identifies the top 5 business outcomes or improvements that are sought by companies from the use of pre-hire assessments:

While almost all companies use assessments during the hiring process, only 50% of survey participants use assessments for current workforce management.  Nonetheless, the interest in using assessments for internal human resource management is increasing and particularly for the following applications:

WHAT ASSESSMENTS ORGANIZATIONS ARE USING

The most common types of assessments used by business continue to be personality, skills and cognitive abilities assessments.  New developments in testing such as simulations and bio data analysis are getting a lot of press but seem to be limited in the uptake.

The hiring process used by most organizations also continues to be following the classic steps of resume review, reference checks, prescreening questions, testing, interviews and background investigations. Although 70% + of respondents use or plan to use social media sites for sourcing job applicants, only 20% or so believe such sites are effective tools for determining candidate fit or will have a major impact on how talent is recruited, measured and managed.

ASSESSMENT USAGE BY JOB TYPE

Although assessments are used for virtually all types of jobs, organizations are using assessments more commonly in hiring for the following positions:

• Managerial/supervisor positions at the entry and mid level
• Technical/professional (particularly for knowledge and skills testing)
• Sales
• Customer service
• Administrative

ASSESSMENT EVALUATION BY ORGANIZATIONS

Despite the fact that most organizations (over 70%) pay lip service to proving the return on investment (“ ROI”) or effectiveness of the hiring tools and processes they use, only 50% of organizations actually do anything about it.

Those companies that do evaluate their use of assessments primarily focus on turnover/retention metrics and supervisor ratings to measure the effectiveness. Although companies can measure all of the desired business outcomes or improvements outlined above (as well as training effectiveness, legal compliance and financial metrics like sales revenue per hire), few companies actually do so.

So why is there such a gap between good intentions and practice?  Both the surveys reviewed in this article and our experience at Prevue Assessments suggest the primary cause is the unwillingness of organizations to commit the time and personnel required to gather and analyze data necessary to prove ROI.  Prevue Assessments will be endeavoring to bridge this gap in the future by creating new online data gathering facilities to simplify both the collection and analysis of ROI data to prove the effectiveness of using Prevue products. If you have interest in this subject we would appreciate your observations and suggestions.

The surveys reviewed in this article cover a wide range of subjects beyond those highlighted in this article.  Complete copies of the surveys can be obtained by email request to support@prevueassessments.com.

Bibliography

1. 2009 Rocket-Hire Pre-Employment Assessment usage Survey, Mark C. Healey and Charles A Handler Ph.D.
2. 2010 Global Assessment Trends Report, Sarah S. Fallaw, Ph.D., Andrew L. Solomonson, Ph.D., Previsor Talent Measurement.