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One Difference Between the Jobless and the Employed: Luck

by May 10, 2011, 1:06 pm ET

In an upcoming Journal of Corporate Recruiting Leadership I make a case — counterintuitive to many of you — that poaching an employee from your competitors isn’t that big of a win as compared to hiring someone who’s actually looking for a job.

In the Journal, I make a few arguments. Let me tackle just one of them here. Luck.

Sometimes we think that those people who are employed have some ineffable, awesome, amazing talent that makes them so valuable that they didn’t get laid off.

Maybe. Or maybe they just got lucky. They were in the right place at the right time, or at least not in the wrong place at the wrong time.

But don’t people make their own luck? To a degree, yes. But less so than we’d like to think.

To give a fairly close analogy, each year MIT receives approximately 17,000 applicants for approximately 1,000 slots. While some of those 17,000 are simply not qualified, conservatively that still leaves approximately 13,000 fully qualified applicants. The difference between the 1,000 who get in and the 12,000 qualified candidates who don’t? The 1,000 received admissions letters. The others received rejection letters. Factors as subtle as whether the sun was shining when a particular file was reviewed or how recently someone on the admissions committee had a cup of coffee can all influence the result. In other words, luck.

Now, perhaps you don’t like the term “luck.” That’s fine. Let’s call it what it really is: those factors in the world that you simply cannot control. Many of us don’t like to acknowledge that such factors exist, but the world doesn’t actually care about our feelings on the matter. When I was a competitive fencer, learning to cope with factors outside our control was part of the game. Perhaps the day of the competition dawns hot and humid, and you don’t deal well with the heat. On the other hand, perhaps you’re a morning person and your division is called for 8 a.m. Or perhaps your first bout is against the one person who can beat you and you get eliminated. If you’d drawn that person later, you might place second; or, perhaps they’d be eliminated before they faced you. Making judgments implicitly based on those random factors blinds us to potential opportunities.

But so what? It doesn’t really do any harm to hire people away from another company, and it may get some good people. Again, we have to think about that.

When the hiring process is biased toward the least loyal people, what sort of mindset are you likely to get at your company? Recognize that behaviors that are rewarded are repeated. What sort of culture are you creating? One that rewards loyalty or one that rewards disloyalty?

At one company, management went through some truly amazing contortions to hire a specific, highly skilled engineer away from the competition. He kept asking for more and they kept giving it to him. Eventually, he accepted the job. In three months, he was gone, and not because he was shot for betraying his former masters. That part only happens in the movies.

On the flip side, now, consider the unemployed person who is actively looking for a job. Here is someone who is failing, getting up, and trying again. Here is someone who is able to maintain an optimistic attitude in the face of constant rejection. Here is someone who is highly likely to feel a great sense of loyalty to the company willing to take a chance on her.

Which employee would you rather have?

This article is provided for informational purposes only and is not intended to offer specific legal advice. You should consult your legal counsel regarding any threatened or pending litigation.

  • Keith Halperin

    Well said. Since most employers can’t get the top 5-10% they drool over anyway, it makes sense to go after solid, reliable, hardworking people who’ll do what needs to be done and will be grateful and loyal.

    Cheers,
    Keith

  • http://www.iscoutnow.com Christy Carter

    The amount of discrimination I see every day is appalling. Many employers have become so arrogant, that they claim (out loud) that they are only interested in people who are employed, specifically at a competitor. The comment that usually comes next is “and anyone who has a resume posted online is garbage.”

    If only job seekers knew the truth: that by doing the one thing that your family, friends & colleagues tell you to do when looking for work – that one thing – “get your resume out there” – just by doing that, you are ensuring that you will be seen as a waste of time.

    To all of you career counselors out there – if you aren’t doing this already – start telling your job seekers to be as hard to track down as possible. And most importantly, make sure they know NOT to tell anyone they are looking for work. For only then will they be worth hiring.

  • Richard Melrose

    There are plenty of presently unemployed people who, in the right job, will outperform many of those who have never spent a jobless day in their entire adult life.

    A few years back, a survey from Business 21 Publishing reported that the majority of HR executives believe their companies are “way too tolerant” of poor performance. Only 3% felt that their companies have performance management systems that allow them take quick action to deal with poor performers. A third felt their managers let people “get away with murder.”

    Based on knowledge worker productivity studies (Hunter, Schmidt, et al) the upper half of “average” employees (those 68% of total in the +/- 1 sigma middle of the bell-shaped curve) outperforms the lower half by a factor of 1.6 to 1. So, we don’t even have to compare top and bottom performers to find stark performance differences among those who still have jobs.

    Most of the nation’s approximately 16.4 million current illicit drug users and approximately 15 million heavy alcohol users hold full-time jobs (Source: SAMHSA study; http://1.usa.gov/j3U8J2.)

    And in 2009 (latest year reported by National Retail Federation), the majority of U.S. retail shrinkage in 2009 was due to employee theft, at $14.4 billion, accounting for 43% of total losses and 23% more losses than inflicted by shoplifters.

    The numbers of incompetent, dishonest, lazy, misplaced, subpar-performing, substance-abusing employees will always exceed the total number of unemployed, by a very wide margin.

    The challenge remains: to pick the right person for the job … and current employment does not predict job performance … neither does unemployment, a great resume, years of experience, age, alma mater or a terrific interviewing presence.

    Richard Melrose
    r.melrose@vision21.us

  • http://www.inboundrecruiter.com Brian Kevin Johnston

    I Have a Client Stating ONLY Engineers for Google, Linkedin, Facebook, Yahoo, Vmware, etc. from ONLY top engineering schools…MIT, Standord, Berkeley, CalTECH, etc. Would you walk away from 40-50k TPR fees? From my view, it is not my job judge them, (God is in charge of that) my firm’s job is to serve the customer. GREAT ARTICLE!!!

  • http://www.7stepsahead.com Stephen Balzac

    I agree it’s not our job to judge the client. Educating the client, on the other hand, is another matter entirely :)

    Drawing candidates from top schools has at least some logic to it, at least if you’re looking at entry level jobs. Those schools have the reputations they do for a reason. That doesn’t mean that you’ll always get someone fantastic, but there at least *some* reason to believe the odds are in your favor.

    In the end, though, people want to hire those who look like them. No one wants to feel like they could be unemployed, so they don’t want to hire someone unemployed (I go into this in a great deal more depth in the Journal article).

    -Steve

  • http://www.certushr.com Tony Crisci

    The best is when you are in a company and you see your below average performers get recruited out and you see on a blog somewhere that a recruiter is fired up about pulling the passive “talent” away from your company. The only reason that person hasn’t been released previously is because no one had the guts to address it, and that same “talent” has been trying to fly under the radar since they started. This is always a favorite topic of mine.

  • Keith Halperin

    @Stephen: and Everybody:
    From my research on this subject, I have found NO documented studies that individuals who either have higher GPAs or are from more selective schools perform significantly better on the job after they are hired than those who do not, with the exception of attorneys, where there is a SLIGHT correlation.

    @Brian:
    Hope you charge those arrogant folks a full 30%.

  • http://www.7stepsahead.com Stephen Balzac

    @Keith: what can I say? That doesn’t match with my experience. However, I will also qualify that observation by adding that there is the “team of experts” vs. “expert team” effect going on, and some of the most individually brilliant engineers/etc that I’ve met are also amongst the worst team players.

  • Melinda White

    Excellent article and it’s about time that this topic has been addressed! As “behind the scenes” profesionals, it’s incredible what we witness. Layoffs are somehow unscientifically correlated with performance issues, when it is quite the opposite. The worst performers are frequently kept, promoted, and hired due to relationships, politics, and LUCK. Good point about how unemployed individuals have to endure more in terms of rejection and patience, while still maintaining optimism and tenacity. Stellar people are laid off, unemployment, and overlooked.

  • http://www.linkedin.com/in/annpost Ann Post

    I went from having the ideal recruiting job to no job courtesy of the January 2009 job purge monsoon. The “be perfect” interview process was exhausting. I ignored the many rejections and appreciated the kindness of helpful people along. I never found the amazing company that I thought I was perfect for. I stayed open for opportunities and eventually worked several lucrative contract assignments. Recently I experienced the fastest and simplest interview process and am now working as a full time corporate recruiter doing exactly what I wanted all along. Still learning what my hiring managers want but I am looking for candidates who read job postings, research the company and attach resumes that tell me their interests and experiences make them desirable applicants. Not easy but I am seeing those resumes and I am calling. I don’t care if they are working or not but how they can positively tell a story. I say luck and effort equals success but Stephen writes, is it more luck that separates us?

  • Keith Halperin

    @ Stephen: I hear you. That may not match your experience, but as I often need to remind a frequent and prominent ERE author: “the plural of anecdote is not data”.
    Show me recognized studies that say better grades and elite schools make significantly better performing employees than those who don’t make quite as good grades or go to those elite schools, I will publicly acknowledge that. Until that point, I say if your company goes by those standards, they are prejudiced and WRONG.

    @Melinda: Well said.

    @Ann: Very good to hear your story. I know of someone who recently was able to return to a decent job after two years unemployment. I hope millions others follow in his and your steps….

    Keith Halperin

  • http://www.7stepsahead.com Stephen Balzac

    @Keith: Of course. We all know that the plural of anecdote is case study, and the plural of case study is data… :)

    Seriously, you are raising a very valid point and one that is very broad. Different elite schools are more or less deserving of their reputations, turn out students who may be more suited to academia than corporate life, have more or less grade inflation, and so forth. My guess is that when you spread the observations across enough “elite” schools, you see less and less of a benefit. To really answer this question, we’d have to look at each individual school and see how graduates of that school do in those fields that the school emphasizes, compared to people with the same level of education from non-elite schools. And that, I suspect, hasn’t been done (although if I have some time, I may trawl around the research databases and check).

  • http://www.7stepsahead.com Stephen Balzac

    @Ann: There’s an old saying that luck is when a thousand hours of preparation meets a moment of opportunity. That moment of opportunity has to come though.

    A friend of mine landed a nationally syndicated column. He did all the research, identified the people he need to talk to, contacted them, made the pitch, and the response was, “How long do I have to listen to you before I get to tell you to **** off.”

    A week later, he was flying to a conference and happened to be sitting next to an exec from the same news company that he had just been rejected by. He made the pitch while they were chatting on the flight and landed the column.

    He certainly put in the hard work, but the moment of opportunity equally certainly came where he least expected it.

    On a broader level, I’ve observed a tendency is people toward retrospective certainty: in other words, we look back at a sequence of events and become convinced it was inevitable. When I run leadership and negotiation business simulations (a type of live action serious game), I’ve had people walk up to me at the end and complain how the scenario was completely rigged: it had one predetermined outcome and no other was possible. I listen politely, and then tell them about the other five (or ten or twelve) times I’ve run the same scenario with completely different outcomes; the participants in those scenarios were often equally convinced that their outcome was the only possible one.

  • Keith Halperin

    Thanks, Stephen. I’d be interested in such stiudies, and how how they might be able to overcome selection bias: a company that hires people from one type of school might unintentionally or intentionally discriminate against those who “aren’t quite our type”….

    Cheers,

    Keith

  • http://www.talenttalks.com Kelly Blokdijk, SPHR

    Luck, timing and opportunity does play a part in many aspects of employment. As for the “passive” candidate pursuit, I find this unfortunate on many levels. At every single company I’ve worked for there were at least a few incompetent, lazy and nasty people at every level. There are too many reasons to list for why that is the case, but the point is by some definitions those people are the “best” talent merely due to being employed.

    I’ve also witnessed countless high performing people losing jobs through no fault of their own. Perhaps there was politics involved, financial issues, or just some random selection process to eliminate headcount. In vary rare cases, I’ve seen people be let go due to performance either individually or part of a mass RIF.

    Regardless, there are always questions as to why those people were cut and others were not. On the opposite side, those same questions occur when certain individuals are promoted, retained and sought after for bigger opportunities while others with far more potential, intelligence and capacity to add value are left behind at lower levels or not considered at all because they happen to be in between jobs.

    Terrific and timely article!

  • http://hrthebottomline.blogspot.com/ Nancy Robin Gillman, MBA, SPHR

    It is very difficult to make a decision to consider someone on their employment status in today’s market for a number of reasons. Just because someone is still employed at a company does not mean s/he is the best candidate.

    It may mean they are the most average candidate because they were not confident/competent enough to venture out to a new company or to try new ideas. It may mean they are the most unscrupulous candidate who stabbed their fellow employees in the back to get to stay in their current position. It may mean they are still there in their current job because of nepotism. It may mean they are overworked and do not have the energy to start a new job. It may mean they are “yes” men and women. It does not mean they are the “best” candidate.

  • Sarah Shook

    I really enjoyed this article. I have seen discussions that made my blood boil where recruiters talked about only considering candidates who were currently employed because those were the “A players”. Sometimes “A players” are let go during hard times, and sometimes a person is put in a bad work environment or is under-trained and doesn’t get the opportunity to thrive. It’s our job as recruiters to be able to match the candidate’s skill set, personality, etc. to a position (and vice versa), and we need to be able to differentiate between potential talent and lackluster skills. With proper guidance and the willingness to learn, anyone can succeed – the question is, will we give them the opportunity?

  • Megan Stanish

    Wonderful article! The comments — both number and content — after are reassuring as well in that so many recognize the lack of logic behind only considering employed candidates.

  • http://www.RecruiterGuy.com Bill Humbert

    @Stephen, jumping in here pretty late. Nice article. I do believe that luck enters into the equation. However I also believe that candidates may make their own luck by aggressively networking their way into a company instead of posting and praying – just as your friend did on the plane – a combination of both.

    @Melinda – I agree.

    @Keith – I agree with you also. Depending on the situation, a person with a strong work ethic and street sense may run circles around a candidate who feels entitled as a result of their education or one big success on the job.

  • Keith Halperin

    Thanks, Bill. As everybody knows, you are a very “agreeable” Recruiter Guy.

    Cheers,

    Keith