The Oregon Business Coach

Management wisdom says overqualified employees are trouble, but the research doesn't support that claim!

With the lack of enough jobs to go around, many mid to senior level employees have found themselves in the job market. Because of their age and experience, they are encountering unreasonable barriers to re-employment, even in the same lower level positions they held previously.

These employees do not need to be trained, have demonstrated mastery of the required skills, and have demonstrated an ability to do the job. Research shows that these employees tend to be more productive than lesser qualified individuals, and they work at the same pay scale as other employees.

Since a small productivity increase can easily increase profits many fold, experienced workers should be highly desirable. Why the prejudice against overqualified workers?

Handed down management wisdom claims that overqualified workers are easily dissatisfied with their work or pay, are harder to manage, and are more likely to leave for a better position. There is a suggestion that underutilization will lead to poor quality work.

It turns out that these claims have been hypothesized, but have not been proven to have negative impact on employment or work quality. To share the full results with you will require a paper, not an article. In the mean time, google “workforce overqualified”.

By 1990 various estimates suggested that as much as 30% of the workforce was overqualified (either by education or experience) for the positions they held. With the continuing push for the workforce to gain education and certifications the number should be much higher today—perhaps 50% or more.

If overqualified employees are a problem, what should you do about the overqualified people you currently employ?

Surveys have shown that overqualified workers expect to be better managed; they are also likely to want latitude to make decisions that affect their performance. In trade, they have higher expectations of themselves, a higher overall level of performance (productivity and quality) and they understand how their job impacts the rest of the company.

My point is that what experienced workers want is just what you should want, too—for the business to be well run, and for employees to work together synergistically.

By the way, if your goal is not to develop your business so that it can run without you, it should be! R. H. Grant said “When you hire people smarter than you are, you prove that you are smarter than they are.” Hire people that know more than you, so that you are free to manage the development of your business.

Bottom line, hiring the overqualified is just good business!

Paul Hanchett, MBA HRM

The Oregon Business Coach