Traditionally, the main objective of personnel selection was to identify those candidates who were expected to have the highest added value for organizations over time. Accordingly, selection procedures had higher gains, not only when the instruments used showed high validity but also when organizations could choose from a larger pool of applicants (Cascio, 1999). This is because a large applicant pool enabled organizations to be more selective, to hire only the top choices, and therefore to reduce the risk of hiring poor-performing individuals.
In other words, traditional personnel selection not only benefited from an abundant labor market, but also was grounded upon the taken-for-granted assumption that organizations could choose among applicants and that virtually all job offers would be accepted by applicants. In simple words, almost all the discussion of personnel selection has assumed that there are always more applicants than job vacancies. In the real world, this assumption cannot be taken for granted. There might not be enough applicants for job vacancies. In recent years, shortages in different labor markets have become apparent across many countries.
In a recent study of 500 large American corporations, the META Group Inc. found that businesses nationwide are struggling to fill 600,000 information technology jobs with people skilled in areas such as networking, database management, supply chain collaboration, business-to-business integration and commerce chain management. That’s down from the nearly 1 million vacancies posted in 2000, but coming in the midst of an economic downturn, it’s indicative of the continuing shortage facing IT recruiters, said Maria Schafer, program director in META’s executive services division.
Another example also indicates the same situation. A survey from the Trade Unions of the United Kingdom showed that nowadays the percentage of unemployment in the UK had become the nadir during the past 20 years. However, at the same time, many industries such as health care, educating agencies, small businesses, professional companies and construction companies were suffering from unfilled vacancies. In London, two thirds of corporations had reported skilled-talent deficiency. It is a problem not only taking place in the developed countries, but also becoming more and more obvious in the developing countries.
China, the country has the largest population of the world, cannot make an exception of this trend. Wu Degui, a senior official of Ministry of Personnel of P. R. C claimed that China was stepping into an awkward predicament for the shortage of senior managers, senior technical talents, etc. He also pointed out that America was short of 850,000 talents for highly skilled work while Germany 100,000, and 200,000 in Japan. To solve it out, these governments would take aggressive strategies for talents war. How did labor market shortage occur? Here comes the fundamental theme: identifying the reasons bringing the problem of labor shortage.
Only by having a clear understanding to the reasons, can the doubts be resolved radically. Skill or labor market shortage occur from a change in labor market conditions due to structural factors, such as changes in consumer tastes for products and services and aging population. The baby boomers will soon begin retiring, and so far, little has been done to replace their skills. Behind the baby boom is a “baby bust”, so the market is looking at a 10-year shortage of skills before the supply catches up. (see the example of Canada from the bar chart below).
Demographic and labor force trends present a much different future situation than in the past. As we all know, the aging population of European countries has become an obstacle to their continuous development. Some other more important changes are the growing knowledge and skill-intensity of employment, and changes in skills requirements within existing occupations. Well-educated and highly skilled “human capital” is far to enough. That is why the higher skills required, the fewer applicants provided, vice versa. The overarching goal should be to make better matches between applicants and jobs.
Instead of making better use of the precious human capital by uncovering the right applicants who truly fit the jobs for which they apply, it is a waste of the already insufficient senior human resource to mismatch the skills and jobs. How can we match the already changed labor market situation? Given the real situation in the labor market worldwide, being different from the assumption that is the basis of current selection theory, it is time for us to reconsider the theory. It did work well when there were abundant applicants. However, when changes occurred in practice, theory should also have been improved.
That is why selection works well in theory, but not an effective guidance for practice. Hence, it is urgent for us to fill up the gap between the theory and practice in terms of a benign cycle. Research attentions for attraction of prospective applicants In order to gain a positive position in this “war for talent”, issues regarding the attraction of prospective applicants, which has not been systematically included in the current selection theory, have received increased research attention (see Barber, 1998; Breaugh and Starke, 2000; Highhouse and Hoffman, 2001, for reviews).
One of the central research questions has been which factors affect applicants’ attraction to organizations. In a comprehensive study (n=361), Turban et al. (1998) found evidence that the organization’s image, job characteristics (especially pay), and organizational characteristics (such as organizational size) were related to organizational attractiveness. Along these lines, Schneider’s (1987) “attraction-selection-attrition” model has been frequently used.
According to Schneider, people are attracted to different types of organizations, depending on their interests, needs, norms and personality. Studies, which examined organizational attractiveness from this person-organization fit perspective, generally found support for its assumptions (e. g. Judge and Cable, 1997; Lievens et al. , 2001; Turban and Keon, 1993; Van Vianen, 2000).
Apart from the continued interest in person-organization fit, it is believed that a new and promising direction consists of applying marketing principles to the labor market shortage problems (Maurer et al. , 1992). The science of marketing may be relevant here, because attracting and retaining employees have a lot of parallels with attracting and keeping customers to buy products or brands. applicants remembered more information from the advertisement of a company with a good image. People were also willing to earn a little less in such a prestigious company.
Another concept from marketing, namely brand personality, can also be used to better understand organizational attractiveness. Drawing on research in marketing and advertising, in the early stages of the recruitment process, prospective applicants ascribe personality traits to organizations. These trait inferences about organizations were related to broad perceptions of organizations and their attractiveness as employers. However, we cannot take it for granted that marketing principles are not a kind of panacea.
Market-driven adjustment will “solve” part of any skill problem that is cyclical. In short, labor market shortages have resulted in a greater concern for organizational image, the treatment of applicants during selection processes, and using marketing principles to attract top potential applicants to choose an organization’s offer of employment above that of a competitor. Until now, only a limited number of studies have been conducted that have used such a marketing perspective to recruitment.
Therefore, future studies are needed to test and validate further the marketing logic in recruitment. It is especially important that these studies borrow well-researched theoretical concepts from the field of marketing. Only in this way can the improved selection theory match the already changed labor market and have a better performance in practice. Even if this problem had been solved, that is to say, there are adequate applicants for each specific position, marketing theories would also be necessary in terms of the other assumption of selection theory, which is “selecting the best”.
