What adding more college graduates buys for employers — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

What adding more college graduates buys for employers

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in Hiring,Human Resources

For some occupations, raising the level of education required of new employees pays off big for businesses, according to research published in The Talent Equation, by CareerBuilder CEO Mat Ferguson and business professors Lorin Hitt and Prasanna Tambe. The authors analyzed the career histories of more than 20 million résumés, connecting these workers to the bottom lines of thousands of employers. The analysis specifically linked the firms’ workforce education-levels to changes in company performance

For some job functions, particularly in areas that don’t traditionally require a college education, hiring more workers with college degrees appears to significantly affect a company’s bottom line. Specifically, a 10% increase in the number of college-educated employees produced the following per-employee additional value:

Customer Service: $26,000

Sales: $31,000

Management: $63,000

Source: Harris Interactive/CareerBuilder poll, March 2014

For large firms, this amounts to a significant return for a relatively modest cost. It’s worth noting, however, that positive correlations between college-educated new hires and business returns don’t apply to all occupations. For example, the correlation disappeared for information technology workers, probably because IT skills and knowledge acquired in college so quickly become obsolete.

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