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The Effect of Degree Characteristics on Hiring Outcomes for I-O Psychologists

Alexandra M. Rechlin and Kurt Kraiger
Colorado State University
The purpose of this paper is to inform discussion on the relative merits of three factors on the hiring outcomes of students graduating from I-O programs: degree type (online versus face-to-face), degree level (master’s versus PhD), and whether or not an internship is completed. We do this through empirical research. We recognize that an increasing number of online master’s and PhD programs in I-O psychology are being offered, yet there is little to no research on the perceived value (in I-O psychology) of online degrees. In addition, some individuals have a difficult time deciding whether or not to pursue a master’s degree or a PhD, and students often wonder about the importance of obtaining an internship while in graduate school. This study addresses these important questions.
Online Versus Traditional Degrees
Undergraduate and graduate courses are increasingly being taught online. In the fall of 2002, 9.6% of undergraduate enrollment was online; by the fall of 2009, that number had risen to 29.3%. In 2007–2008, 22% of postbaccalaureate students (800,000) were enrolled in an online course (U.S. Department of Education, 2011). Degrees offered entirely online have also become popular. From 2007–2008, 9% of postbaccalaureate students took their degree entirely online (U.S. Department of Education, 2011).
Due to the recent increase in online degrees, in 2009 SIOP’s Education and Training (E&T) committee formed a subcommittee to study existing online master’s and PhD I-O programs. The subcommittee identified 12 different master’s or PhD programs from 10 universities. To examine employers’ reactions to online degrees, the subcommittee distributed a short survey to organizations recruiting through the SIOP website. Although only six people responded, the subcommittee found that employers overall were neutral to slightly negative in their perceptions of online degrees (Dahling et al., 2010).
Further, in 2010, the Society for Human Resource Management (SHRM) conducted a poll of HR professionals’ hiring practices and attitudes regarding online versus traditional degrees. The majority of respondents agreed that job applicants with traditional degrees were preferred by their organizations, although 87% of respondents agreed that online degrees were viewed more favorably than they were 5 years ago (SHRM, 2010).
Based on these survey findings, it is predicted that job applicants from a traditional university (that is, offering face-to-face classes) will be viewed more favorably than applicants with online I-O degrees.
Hypothesis 1: Applicants with degrees from a traditional university will be viewed more favorably (in terms of likelihood of receiving an interview, likelihood of being hired, and starting salary) than applicants with degrees from an online university.
Master’s Versus PhD
Master’s degree programs in I-O have become increasingly popular over the last 20 years (Roch, 2009). Traditionally, there has been a bias against master’s graduates, and master’s programs have striven for legitimacy (Koppes, 1991). Due to this traditionally negative bias towards master’s degrees in I-O, it is expected that applicants with a PhD will be viewed more favorably than those with master’s degrees.
In practice, master’s degree or PhD graduates may perform similar work. However, there are still a number of differences in roles and responsibilities (Schippmann, Hawthorne, & Schmitt, 1992), and these differences are reflected in relative salaries. According to the 2009 SIOP income survey, the weighted mean salary for someone with a PhD in I-O was $112,728, compared to a weighted mean salary for someone with a master’s degree in I-O of just $77,591 (Khanna & Medsker, 2010). It therefore is expected that applicants with a PhD will be offered higher starting salaries than applicants with master’s degrees.
Hypothesis 2: Applicants with PhDs will be viewed more favorably (in terms of likelihood of receiving an interview, likelihood of being hired, and starting salary) than applicants with master’s degrees.
Internship Experience
Many graduate students are interested in obtaining internships in order to help them acquire jobs after graduation, and many graduate programs require formal internships. SIOP data indicate that approximately 25% of PhD programs and 37% of master’s programs require supervised internships (Cassidy, 2010). Although there is anecdotal evidence that internship experience is helpful in obtaining one’s first I-O job, to our knowledge there is no supporting empirical evidence. However, Cassidy surveyed I-O psychologists and found that nearly 83% of respondents agreed or strongly agreed with the statement that “work/internship experience acquired before, or during, graduate school results in greater employment opportunities upon graduation.”
There is substantial evidence, however, that internships are beneficial for undergraduates. For example, Gault, Leach, and Duey (2010) found that undergraduates in a business school were more likely to receive job offers if they had completed an internship, and Gault, Redington, and Schlager (2000) reported that intern alumni had higher salaries than non-intern alumni. Based on the empirical evidence from undergraduates and the anecdotal evidence in the I-O community, it is expected that applicants who completed an internship will be viewed more favorably than applicants without internship experience.
Hypothesis 3: Applicants with one year of internship experience will be viewed more favorably (in terms of likelihood of receiving an interview, likelihood of being hired, and starting salary) than applicants without internship experience.
Participants were 23 psychologists working in I-O psychology consulting firms and responsible for hiring other I-O psychologists. Of the 23, 19 were male, 3 were female, and 1 did not provide gender information. Participants ranged in age from 35 to 65 years old (M = 47.9, SD = 9.80) and were primarily White (20 White, 2 Hispanic/Latino, 1 did not respond). Nearly all participants (n = 19) had completed their PhD, one had a master’s degree, one had a PsyD, and two did not provide degree information. Nineteen participants had obtained their highest degree in I-O psychology, one in social/personality, one in experimental psychology, and two did not respond. Participants completed their highest degree between 1971 and 2005 (M = 1991, SD = 10.75).
Companies in the study employed 0–80 full-time PhDs (M = 12.87,
SD = 18.20), 0–6 part-time PhDs (M = 3.15, SD = 4.36), 0–160 full-time master’s-level I-O practitioners (M = 15.3, SD = 34.61), and 1–40 part-time master’s-level I-O practitioners (M = 3.57, SD = 8.30).
Participants were e-mailed and asked to participate in a research project examining the effect of different characteristics of an I-O psychologist’s training on hiring outcomes. Participants were also told that the applicant profiles were fictional but intended to portray characteristics that might actually be used in a hiring decision. They were then provided a link to the online survey.
Upon clicking the survey link, participants were presented with an online informed consent. Then participants viewed eight different applicant profiles representing potential recent graduates from I-O psychology programs applying for a job with their organization. After viewing a one-sentence description of each applicant, participants rated the applicant on the three outcome variables (described below). After responding to the applicant profiles, participants completed an optional demographics survey.
Stimuli and measures. Participants viewed eight different brief applicant profiles, ensuring that each combination of the three independent variables (online vs. traditional degree, master’s vs. PhD, internship vs. no internship) was rated once. For example, two applicant profiles were: “This applicant received his/her master’s degree in I-O psychology from an online program and did not complete an internship during graduate school,” and “This applicant received his/her PhD in I-O psychology from a traditional terminal degree program (i.e., not online) and completed a 1-year internship during graduate school.”
Based on the applicant information, participants rated the applicant on the three outcome variables. The first question was, “What is the likelihood that you would invite this applicant for an interview?” and the second question was, “What is the likelihood that you would hire this applicant?” Participants responded to both questions using a 5-point Likert-type scale (1 = very unlikely, 5 = very likely). The third question was “If you did hire the applicant, what is the starting salary that would likely be offered to this applicant?” and participants responded using a 9-point Likert-type scale (1 = less than $30,000, 5 = $60,000 to $70,000, 9 = greater than $100,000).
A doubly multivariate repeated measures MANOVA was conducted to analyze the data. The dependent variables were the likelihood that the applicant would be invited to interview, the likelihood of the applicant being hired, and the starting salary offered to the applicant. The within-subjects variables were the applicant’s degree (master’s or PhD), type of degree (online or traditional), and whether or not the applicant had internship experience.
Hypothesis 1
Hypothesis 1 predicted that applicants with degrees from a traditional university would be viewed more favorably than applicants with degrees from an online university. Estimated marginal means and standard errors can be found in Table 1. All tests were significant. If applicants had a traditional degree, they were more likely to be invited to interview [F(1, 22) = 6.37, p = .000, η2 = .76], more likely to be hired [F(1, 22) = 37.07, p = .000, η2 = .63], and more likely to be given a higher starting salary [F(1, 22) = 24.30, p = .000, η2 = .53] than were applicants with online degrees. Hypothesis 1 therefore was fully supported.
Table 1
Estimated Marginal Means and Standard Errors of Variables for Hypothesis 1
    M SE
Likelihood of being invited to interview
  Online degree 2.54 .13
  Traditional degree 3.61 .16
Likelihood of being hired
  Online degree 2.35 .12
  Traditional degree 3.08 .12
Starting salary offered
  Online degree 3.83 .24
  Traditional degree 4.39 .26
Hypothesis 2
Hypothesis 2 predicted that applicants with PhDs would be viewed more favorably than applicants with master’s degrees. Estimated marginal means and standard errors can be found in Table 2. All tests were significant. Applicants with PhDs were more likely to be invited to interview [F(1, 22) = 33.52, p = .000, η2 = .60], more likely to be hired [F(1, 22) = 14.97, p = .000, η2 = .41], and more likely to be given a higher starting salary [F(1, 22) = 107.89, p = .000, η2 = .83] than were applicants with master’s degrees. Hypothesis 2 therefore was fully supported.
Table 2
Estimated Marginal Means and Standard Errors of Variables for Hypothesis 2
    M SE
Likelihood of being invited to interview
  Master's 2.78 .15
  PhD 3.37 .13
Likelihood of being hired
  Master's 2.51 .12
  PhD 2.91 .11
Starting salary offered
  Master's 3.24 .21
  PhD 4.98 .30
Hypothesis 3
Hypothesis 3 predicted that applicants with 1 year of internship experience would be viewed more favorably than applicants without internship experience. Estimated marginal means and standard errors can be found in Table 3. All tests were significant. If applicants had internship experience, they were more likely to be invited to interview [F(1, 22) = 26.49, p = .000, η2 = .55], to be hired [F(1, 22) = 34.38, p = .000, η2 = .61], and to be offered a higher starting salary [F(1, 22) = 13.07, p = .001, η2 = .38] than were applicants without internship experience. Hypothesis 3 therefore was fully supported.
Table 3
Estimated Marginal Means and Standard Errors of Variables for Hypothesis 3
    M SE
Likelihood of being invited to interview
  No internship experience 2.70 .15
  Internship experience 3.46 .14
Likelihood of being hired
  No internship experience 2.37 .12
  Internship experience 3.05 .12
Starting salary offered
  No internship experience 3.95 .26
  Internship experience 4.27 .23

The goal of this study was to inform debate about the extent to which various characteristics of I-O applicants affect hiring outcomes for applied positions. Specifically, we examined whether an applicant’s degree (master’s or PhD), type of degree (online or traditional), and internship experience would affect the applicant’s likelihood of being invited to interview, likelihood of being hired, and starting salary offered. Although many of the results for this study were anticipated, this study is the first attempt at quantifying the effects of degree level, degree type, and internship experience on hiring outcomes.
Accordingly, our results should be of great interest both to potential applicants and to professionals who advise them (e.g., advisors of undergraduates). Individuals who choose a master’s program over a doctoral program or an online program over a traditional program may have valid reasons for doing so but should understand up front the possible negative consequences of their choice.
The Online Degree Debate
For potential employers, and for purposes of professional debate, it is not unexpected that graduates of traditional programs received better hiring outcomes than graduates of online programs. However, what remains unknown is whether this result is from differences in the perceived quality or the actual quality of online programs. While distance learning degrees appear to be as effective as traditional degrees in terms of student learning (Allen et al., 2004; Sitzmann, Kraiger, Stewart, & Wisher, 2006), potential employers still viewed online graduates more poorly. Is this simply an issue of inaccurate perceptions by employers of the quality of online education? If so, then online programs (and their students and graduates) need to work systematically to improve these perceptions. For example, programs could reach out to potential employers to increase understanding of the nature of online programs, the courses provided, and the rigor of those courses. Online graduates could tout their experience collaborating with others using electronic means (an important skill in today’s work environment) and the self-discipline necessary to succeed in an online program. Instructors in online programs could also aim to change perceptions of online degrees.
On the other hand, our results could reflect lower actual quality of online programs compared to traditional programs. Such differences would be difficult to quantify. Just as there is no universally accepted ranking system of traditional programs, there are no clear criteria by which online programs could be compared to traditional programs in terms of the quality of their graduates. Some criteria may be comparisons of “raw input” (e.g., mean GRE scores of incoming students), the research productivity of program faculty (e.g., Oliver, Blair, Gorman, & Woehr, 2005), the extent to which graduate training corresponds to an accepted model of practitioner training (see Belar & Perry, 1992; Society for Industrial and Organizational Psychology, 1999), or the success rate of students passing state licensing exams (though the proportion of I-O psychologists who seek licensing is slight).
Note too that the quality of online programs also differs by the school offering it. An important question to ask is if employers view an online degree from a more reputable online program, such as those based on traditional programs (e.g., Kansas State University or Colorado State University), differently than they view degrees from enormous online universities that may be perceived as degree mills. It is possible that online graduates from more reputable programs may be viewed similarly to traditional graduates. In that case, the results of this study may have been driven by poor perceptions of less reputable programs.
In combination with initial work by SIOP’s E&T committee, we see our results as leading to important discussions as to why graduates of online programs may fair worse in the job market than graduates of traditional programs, as well as more basic discussion and debate as to the skill sets expected of graduates (e.g., Fink et al., 2010) and how both graduate curriculums and program graduates can be meaningfully compared across delivery media.
One result of such discussion is a better understanding of the comparative skill sets acquired in different types of programs. For example, graduates from traditional programs may be more likely to be perceived as being able to conduct research. However, online graduates may obtain skills that may set them apart from traditional graduates. Online graduates need to be very self-disciplined to be able to achieve, and they must be able to work independently and also be able to work collaboratively using electronic means.
These results suggest that employers perceive graduates of traditional programs as more qualified or better than graduates of online programs, when the more critical question may be, how do they differ?
Other Findings
We also found that applicants with PhDs were viewed more favorably than applicants with master’s degrees. This result was not a surprise, as it is logical that applicants with more education would see better hiring outcomes. We know from the SIOP income survey that I-O psychologists with PhDs make, on average, far more money than I-O practitioners with master’s degrees (Khanna & Medsker, 2010), and PhDs are likely more qualified due to their additional years of education. A major reason that many students pursue a PhD is to have a better chance of obtaining a good job, so it is perhaps reassuring to many that PhDs are indeed more likely to experience positive hiring outcomes. Nonetheless, a better understanding of which advantages ascribed to PhDs are perceptual and which can be attributed to agreed upon criteria can help both employers and potential applicants make more informed decisions.
Finally, we found that applicants who had completed a 1-year internship were viewed more favorably than applicants who had not completed an internship. This is consistent with prior research with undergraduates indicating that students with internship experience are more likely to be offered a job (Gault et al., 2010) and have higher salaries (Gault et al., 2000). However, this is the first study to extend this effect to I-O graduates.
Limitations and Directions for Future Research
As with all research, there were some limitations to this study. First, the sample size was small. However, it was an interesting, relevant sample made up of psychologists at least partially responsible for hiring I-O psychologists in their firms. Further, despite the small sample size, significant support was found for the three hypotheses. A second limitation is that participants rated short, one-sentence descriptions of applicants instead of viewing complete and realistic resumés. Participants obviously were aware that they were not rating real applicants. Further, without the full details of actual resumés, the manipulated characteristics may be more salient than they would be in real-life scenarios. Future research should focus on hiring outcomes for real applicants (and/or more realistic resumés) to determine if the effects found in this study hold up for actual job applicants (and may shed additional light on the underlying factors on which we speculated).
Online degrees in I-O are becoming increasingly prevalent. The findings in this study, however, indicate that applicants with online degrees are viewed less favorably than are applicants with traditional degrees. If students do indeed achieve the same learning outcomes regardless of the type of degree they have, as the literature on distance learning suggests, then employers should more carefully consider the relative merits of face-to-face versus online curricula, and administrators and instructors of online programs should more assertively market the knowledge and skills of their graduates. It is our hope that this paper will stimulate research and considerable discussion regarding traditional versus online I-O programs.
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