ILR School

Faculty Publications - Labor Economics

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    Predicting Potential For Promotion: How The Data In Human Resource Information Systems Can Be Used To Help Organizations Gain Competitive Advantage
    Fields, Gary S. (2002-07-01)
    This paper utilizes the data contained in the Human Resources Information System (HRIS) of a company, called here “Engineering Solutions,” and analyzes the drivers of potential for promotion among a sample of engineers. The methods used consist of basic statistical procedures, multiple regressions, ordered logits, and decompositions. The results show which variables are the main drivers of potential for promotion in this organization, which are minor drivers, and which do not matter at all.
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    Keeping Our Best: Econometric Analysis of Retention and Performance at Engineering Solutions
    Fields, Gary S. (2002-07-01)
    This study analyzes the retention and performance of 100 engineers who started work at “Engineering Solutions” in 1996, of whom 65 were still with the firm in 2002. The retention analysis shows that the firm retained disproportionately the better performers, those with the psychological attributes that make for greater success, those with greater work attachment, and those with fewer dependent-related job issues. The performance analysis shows that the top-rated engineers are primarily those who exhibit favorable psychological characteristics, that a few other characteristics make a small difference to performance, and that the remaining variables make no difference at all.
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    In There or Up Front? : An Introduction to Bottom-Line Human Resource Management
    Fields, Gary S. (2002-04-01)
    This essay explains to managers and academics a new approach to human resource management, what I call “Bottom-Line Human Resource Management.” Bottom-line human resource management starts by positing clear organizational goals, and in this way differs from strategic human resource management, which starts with analysis of the organization’s human resource strategy. Organizational goals are easily classified; managers cannot manage well unless they know which class of organization they are working in. Not all decisions have right and wrong answers but some do. Managers will earn a seat at the table if they are able to make correct decisions in these cases and to ask correct questions the rest of the time. By embracing their organization’s goals, using sound decision criteria, and conveying their decisions in jargon-free English, managers will be valued partners.
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    Leading For The Bottom Line: A View Of Leadership In A Bottom-Line Context
    Fields, Gary S.; Stern, Cory (2006-03-01)
    This paper sets out to establish and describe a new approach to leadership called Bottom Line Leadership. The essence of Bottom Line Leadership is that a leader’s most critical responsibility is to clearly identify, communicate and gain buy-in for the ultimate bottom-line objective of the organization he/she leads, subject to constraints imposed by the market and by the organization itself. In comparison to other leadership models that focus on the general attributes or behaviors characterizing effective leaders, Bottom Line Leadership emphasizes the link between an organization’s purpose and a leader’s behavior. The philosophy that serves as the foundation for this article stipulates that employees, in any type of organization, need to be crystal clear about the purpose and bottom-line objective of the organization they work for. Having this clarity of objective enables employees to not only understand the importance of an organization’s strategy and mission; it also allows them to make sound decisions in support of the organization’s goals. We believe that it is essential that leaders in organizations instill this clarity of purpose and help create the conditions that allow people to channel their energies into the appropriate activities. What results from our leadership and management research is a “virtuous circle” model coupled with a checklist that prescribes precisely what Bottom-Line Leaders do. To arrive at our model of Bottom-Line Leadership, we review the teachings of some of the most popular leadership and management thought leaders. We conclude that effective leadership actually encompasses both traditional leadership attributes (create / inspire / influence) and traditional management capabilities (deploy / control / execute). In short, what we find is that Bottom-Line Leaders instill clarity of purpose in their organization, gain commitment to the ultimate bottom-line objective, and engage employees in these efforts. They do this by deploying methods of communication, inspiration and motivation that constantly maintain a connection to, and are aligned with, the ultimate bottom-line objective the organization is striving to achieve. They also work tirelessly to ensure that employees are in a position to make decisions and take actions in manners supporting the bottom-line objective. In our view, leaders are those who do the right things right and get their people to do likewise.
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    The Effects of Human Resource Management Decisions on Shareholder Value
    Abowd, John M.; Milkovich, George T.; Hannon, John M. (1989-11-01)
    We examine the effects of selected human resource management decisions on the abnormal change in total shareholder return. Announcements of human resource decisions are classified into five types--general HR system announcements, compensation and benefits, staffing, shutdowns and relocations, and miscellaneous. Using an event study methodology we investigate whether any of these HR decisions had a discernible effect on either the level or variation of abnormal total shareholder return. We find no consistent pattern of increased or decreased valuation in response to the different types of HR announcements, even after controlling for the likely effect of such announcements on total compensation costs. We do find substantially increased variation in abnormal total shareholder return around the announcement date, which indicates that HR decisions do provide information to the stock market. The events associated with increased variation in total shareholder value are permanent staff reductions and shutdown/relocations. The absence of consistent valuation effects combined with the evidence of increased variation in shareholder value may be attributed to uncontrolled firm-specific factors, the categorization of the HR events or, simply, to the unique interpretations the market placed upon these events.
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    Aging, Job Satisfaction, and Job Performance
    Mitchell, Olivia S.; Levine, Phillip B.; Pozzebon, Silvana (1990-01-01)
    The national trend to earlier retirement is surprising in light of conventional wisdom holding that older workers are healthy, satisfied and productive employees -- sometimes even more so than their younger counterparts. This paper examines whether conventional wisdom is wrong by reviewing existing studies and noting some of their most important shortcomings. New empirical evidence is provided on the links between aging, job satisfaction, and job performance using data from a nationally representative survey of workers.
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    The Effects of Mandating Benefits Packages
    Mitchell, Olivia S. (1990-01-01)
    [Excerpt] The purpose of this paper is to inform policymakers and the public about the potential labor market consequences of government mandating of employee benefits. Both theoretical and empirical economic arguments for and against benefit mandating are presented and assessed. In view of the continuing policy debate over health care and parental leave, these two areas are the focus of special attention in the discussion below.
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    Predicting Employee Health Insurance Selections in a Flexible Benefits Environment
    Barringer, Melissa W.; Milkovich, George T.; Mitchell, Olivia S. (1991-05-08)
    Firms are increasingly introducing flexible benefits programs into their employee compensation packages, yet very little is known about program outcomes. This study investigated the determinants of employees' selections among six different health insurance options. Using employee-specific selection and demographic data provided by a large manufacturing firm, we estimated a logistic regression model to analyze the effects of employee and plan characteristics on choice of health care plan. Results suggest that employees' decisions about health insurance are significantly influenced by their age, gender, salary, and marital status. Employee premiums (cost to the employee) did not have a significant effect on health care decisions in this study.
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    Expected Changes in the Workforce and Implications for Labor Markets
    Levine, Phillip B.; Mitchell, Olivia S. (1991-06-01)
    [Excerpt] While many have written about possible effects of the baby boom on the U.S. economy, few have recognized that this demographic transition provides analysts with a unique and valuable opportunity to investigate how the labor market works. Specifically, as baby boomers move up the age distribution, they impart a one-time shock to the supply of potential workers in each age bracket. Because this change is exogenous, many of the tools labor economists typically apply can be utilized to predict how the aging of the baby boom will alter key labor market outcomes. Theoretical and empirical models which (either implicitly or explicitly) hold constant structural parameters in order to work through the effects of an exogenous shock are well-suited to address this issue.
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    Human Resource Management, Information Technology, and the Competitive Edge
    Broderick, Renae F.; Boudreau, John W. (1991-05-01)
    [Excerpt] Global competition is putting more and more pressure on U.S. managers to make faster and better business decisions. Investments in information technology are often touted as a critical means of speeding up and improving management decision making. Yet it has proved distressingly difficult to realize the potential of information technology investments. This is particularly so in business areas such as Human Resources (HR), though the longer lead times traditionally associated with changes in HR systems mean that HR is a prime candidate to benefit from information technology.