EHR Assingments 1 - 3
EHR Assingments 1 - 3 ECON 7061
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This 8 page Bundle was uploaded by Rachel Hedrick on Tuesday February 9, 2016. The Bundle belongs to ECON 7061 at University of Cincinnati taught by Sourushe Zandvakili in Winter 2016. Since its upload, it has received 46 views. For similar materials see Economics of HR in Economcs at University of Cincinnati.
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Date Created: 02/09/16
Economics of Human Resources, E7061 Department of Economics Carl H. Lindner College of Business University of Cincinnati Assignment #1 **NO MORE THAN 5 PAGES** 1. Consider your last job. What attributes were important in determining productivity on the job? Which of these attributes were possessed by new hires, and which were developed only after you were on the job for a while? My last position was an HR CoOp position, which was very similar to an HR Generalist position. There were many attributes that determined productivity on this job, such as organizational skills, ability to meet deadlines, attention to detail, ability to think and solve problems, communication skills, listening skills, pride and personal appearance, capability of following directions, and customer oriented/employee oriented. These were all attributes that new hires would possess. New Hires that would be successful in this role should also have ability to document, take notes, and write standard operating procedures or work instructions. They should also have good listening skills and a positive attitude. In addition to these qualities, my knowledge of the organization also helped determine my productivity on the job. Familiarity with the employees, knowledge of previous employment issues, understanding of the organization departments, functions, and locations, and ability to use the company’s intranet site to search for forms, processes, or product information were also very helpful attributes. These attributes, were qualities that I developed after I was in the position for a while. My understanding and capability of using our HRIS system, onboarding software, and performance review technology were others skill I developed on the job. After I was familiar with my role and mastered the skills listed above, I also began learning the company’s processes outside of HR. For example, I learned how accounting processed our staffing invoices. This developed my ability to look at the process as a whole, rather than each individual step. I also developed a good understanding of the company’s product line, company history, organization structure, benefits package, and cost center/budget allocation. After I was on the job a while, I also began focusing on networking with employees and with outside vendors/customers. 2. Following up on the above, which of these attributes could your firm actually evaluate reasonably well when looking at job candidates? How did they do this? Which attributes would be quantifiable? How? Many of these attributes are challenging to quantify. However quantifying or proving candidates have these qualities, is extremely important for multiple reasons. Starting with the basic attributes, pride and personal appearance can be determined in a personal interview along with the candidate’s positive attitude. By asking a combination of situational and behavioral questions, the candidate’s ability to maintain a positive attitude will be reflected. The candidate’s organization skills can be assessed during the interview also. Automated/online application and onboarding softwares are a great way to predict a candidate’s organization skills and ability to meet deadlines. These systems typically assign the candidate various tasks with corresponding deadlines. The candidate is then required to complete the task using their own log in information by the assigned deadline. Communication and documentation skills could be measured by a preemployment assessment. A short essay evaluation would prove if the candidate was able to listen to process being explained and properly document the steps from start to finish. An assessment asking them to read a documented process and explain what happens after step 2, for example, is another way to measure their ability to follow directions and read standard operating procedures. While having prior experience with our technology was not required for my position, it would have been very helpful to increase my productivity and bridge my training gap. A preemployment assessment or technology test would have been a helpful way to evaluate my technology skills and attention to detail. Inputting sample data into an HRIS system would have been the ideal job stimulation. The company could measure my speed and accuracy with this assessment. Finally the organization could also administer a preemployment assessment to determine how customer orientated I am. In HR, my customers are our employees. But my ability to meet their needs and communicate with them is extremely important for this position. This assessment could be pencil and paper. The test could provide a scenario and the candidate, or myself, would have to choose the correct response from three options. While preemployment assessments can be expensive and a bit time consuming, they are typically very reliable and prevent trouble and expenses in the future or post hire. 3. Consider your own resume. What information can a firm glean about your skills and characteristics solely from this document? What other information might be valuable? What information is misleading or uninformative? What does your resume suggest about the type of job for which you would be a good match? When glancing at my resume you will notice basic information such as my name, phone number, address, ect. In addition, you will notice my college degree, GPA, minor, and current education enrollment. This shows that my area of expertise and focus is HR. My resume also shows that I am a certified Notary Public and an active SHRM (Society of Human Resources Management) member at the national, state, and local level. My involvement in SRM shows my commitment to continuing my education and keeping up to date on HR regulations and trends. My resume will show my previous work experience. Beyond my dates of employment, job titles, and previous organizations, you will notice the specific projects and duties I was responsible for at each company. This portion of my resume shows that I possess basic HR skills have leadership experience, and have a broad understanding of each facet of HR, while specializing in none. Lastly my resume specifically list my technology experience and language abilities. Other info that might be valuable for a firm that is interested in potential hiring me is that I selffinanced 80% of my college education through work, took college classes in high school, completed a 4 year degree in 5 semesters, and studied abroad 4 times. My resume, like most, list my previous two positions. It could be valuable to know more than just the candidate’s previous two years work experience or industry experience. My previous volunteer experience or the fact I work out on a regular basis could also be valuable information for a potential employer to know. All of these things show my drive, responsibility, and personal motivation, but won’t be found on my resume. They also give a good insight to my personality, which is an unmeasurable characteristic that is important to understand before determining how I would fit into the organization’s culture. The references a candidate provides can be misleading. No one provides a bad reference. Some resumes also list the address of your previous employer. In today’s society, we can google the organization’s address if needed. This could be considered uninformative information on a resume. A candidate’s GPA can be misleading also. If the candidate tested into advanced courses or honors courses or worked throughout college their GPA could be lower. This doesn’t mean they are incapable of the class material or achieving high scores. This could mean they were stretched thin or maybe prioritized poorly. A candidate’s resume may also list technology skills such as excel. When the candidate has very basic excel skills and can’t utilize functions, such as graphing or pivot tables. A candidate could also list a software they watched a demo of on YouTube and consider themselves proficient. This information can be very misleading. All information of a resume has the potential to be misleading because you’re replying on the candidate’s honesty. This is why organizations usually conduct background checks, degree checks, and employment verifications. Personally, my resume suggests that a midcareer HR position, such as a generalist, at an international company would be a great match for me. However, this can be also misleading because that is based solely on my previous two years of work experience. My personal interests are to be involved in talent development, rather than strictly HR functions. Economics of Human Resources, E7061 Department of Economics Carl H. Lindner College of Business University of Cincinnati Assignment #2 1. If an individual believes that he or she will face labor market discrimination during their career, what effect do you predict that this will have on their incentives to acquire education? Onthejob training? For the latter, is your answer different if the training is general or firmspecific? Please use economic models to show and explain. If an individual’s feels they will face labor market discrimination, I predict this will have negative impact on their incentives to acquire education. If they feel they are at a disadvantage from the start, they likely will not contribute a large amount of time to improving their qualifications. They will not want to put time and effort into trying to obtain a higher paying position when there are odds of success are low because of the mark discrimination. The individual will have low motivation to acquire education. This type if individual may have a higher desire to obtain on the job training. Onthejob training increases their value to the firm or their current organization. Once the employee has a position and have overcome market discrimination, they will be more likely to commit to the job. Therefore, they are more likely to participate in onthejobtraining. The employee will be very likely to participate in general training to help ensure they are marketable in all markets. However, because they are feeling the possibility of market discrimination, they are more likely to participate in both general and firspecific training and stay with their current organization. One other note, is that onthejobtraining and educational investments are usually made when an individual is younger. Onthejobtraining is usually more important to younger employees also. Therefore if age is one of the individual’s discrimination concerns, they could be more likely to participate in both types of onthejobtraining. Firmspecific onthejobtraining does not make an individual more valuable outside of the organization. Therefore, the firm does not have to pay higher wages to keep the employee. General training is useful in many firms, not just the current employer. Onthejob training typically increases the future marginal productivity of employees in the firms giving the training. It also increases the marginal product in many other firms, as well. Since in wage rates paid by most firms are determined by marginal productivities in other firms, employee’s wage rates and marginal products would increase when the firms provide general training. General training would be equally useful in many firms and marginal products would rise by the same extent in all of them. This means wage rates would rise by the same amount as the marginal product. This makes it hard for the firms to capture any of the return. Since wages and marginal products are raised by the same amount, MPt must equal Wt for all t = 1, n — 1, and so on… If the employee’s training is general this equation can be used: Wo = MP0' C or this equation can be used if discussing actual marginal product: MP0 = Wn + k k = the cost of training If training was given only during the initial hiring period, expenses during the hiring period would equal wages plus the cost of training, expenses during other periods would equal wages only, and receipts during all periods would equal marginal products. k = the cost of training or MP0 + G = Wo + k K only measures the actual cost of training. It doesn’t count the time that a trainer or employee spends on this training. C = sum of opportunity costs and costs of training. MP0’ + G = Wo + C This graph shows the idea that an individual has completed fulltime schooling and enters the labor market at age A 0with earnings at E . Wsth no additional training and no developed skills, earnings would remain at E s over the employee’s life cycle. If the worker chooses to invest in on thejobtraining (OJT), his/her future earnings potential will be increase as indicated by the curve E inp comparison to actual earnings, E , a which lie below E . Tpose who invest in OJT, E sa rts below E and s approaches it at age A* (“overtaking age”) at which E anda are squal, then, E a ses above E. This graph shows the idea that if you bring an employee into your organization or hire them at a lower rate W1 and invest time and money into training them (OJT) you will not have to pay as much in the long run at W3 rather than W2. The worker’s marginal productivity will increase drastically and they will be loyal to your organization with the raise for completing their onthejobtraining. 2. What are the costs of turnover to a firm? (Hint: think about a specific worker that leaves a firm. What costs must the firm pay, implicitly and explicitly, in order to “replace” that worker?). If lower turnover provides benefits to a firm, what policies can you think of that the firm can use to reduce turnover within the context of Internal Labor Markets? If a sales engineer leaves an organization the firm faces recruiting costs. The explicit costs includes job postings, career fairs, recruiting firms/head hunters, time spend reviewing resumes, interviewing candidates, conducting background and reference checks, and time negotiating an offer to a new employee. Once the offer is signed, there many implicit costs, such as the time associated costs with orientation and administrative time setting the employee up in your HRIS system. There is additional time and money wrapped up in training the new employee on the organization, the product line, and job specific tasks. Sometimes there can also be costs associated with the employees’ assets, such as a laptop, car, keys, and phone. The organization must either ensure these items are returned or eat the costs associated with them. If the terminated employee files for unemployment, the firm’s unemployment insurance costs will increase. If the terminated employee files a law suit, the firm has time and money in hiring a lawyer and handling or settling the dispute. If the terminated employee recently completed training or education reimbursement the organization must undergo that cost, as well. A firm could implement a training back pack policy to help reduce the costs associated with training. For example, the employee may be required to pay back 100% of their tuition reimbursement if they do not stay with the organization for at least 2 years after completing the program. A similar policy could apply for general and job specific training that the company provides. The company can also implement a policy that says employees must stay in a position for at least a year before applying for an internal role. While internal moves are typically a good thing for an organization, there are still costs associated with these moves. Some of these costs include for job specific training and recruitment to replace that individual. If an employee would like to make an internal move before their one year term is up, the firm could require approval from human resources and their supervisor to help ensure the move is beneficial and to allow time for a proper costbenefit analysis. Economics of Human Resources, E7061 Department of Economics Carl H. Lindner College of Business University of Cincinnati Assignment #3 1. Many Silicon Valley firms have very high turnover. How do you explain this phenomenon? Are there any explanations based on human capital theory? Can you think of other explanations? The lucrative Silicon Valley gold rush is very fitting. Silicon Valley is experaencing limited supply of engineers and an oversupply of understaffed companies. Most of these companies are fast growing small startups. These business compete for labor by poaching employees from other companies. Companies are even willing to rehire employees that have left previously. Large companies such as Google, Apple, and Adobe have even created an unofficial “treaty” not to hire employees from one another, according to Quora.com. It is hard for large companies to compete with the monetary values associated with startup companies’ stock options. Human capital theory predicts that a given worker has a greater probability of quitting a lowwage job for a higherpaying one according to our class lecture. This theory applies perfectly to this situation. If another company is offering a higher wage workers are likely to leave their current position. Human Capital theory also forecasts that employees are more likely to quit their job during economic booms, such the situation in Silicon Valley. In addition, turnover rates tend to fall when labor markets are loose and less competitive and rise when labor markets are tight and very competitive. Startups are successful these than 25% of the time, typically. This means the average employee only works there for a maximum of 24 years. Hence why the having a 4 year stock option seems like forever in Silicon Valley. The 4 year stock option sets and upper limit for employment in a sense. With this being said, it’s easy to see why employees change employers every 4 years, if not sooner. After all, Silicon Valley seems to be all about managing risk and maximizing one’s economic or financial returns. Lastly, the duration of technology is extremely short. The most successful companies eventually downsize or end up being nothing. Technology dies when something better is created. The same is true for companies in Silicon Valley. Jobs are eventually replaced with new; employee churn is everywhere is Silicon Valley. 2. How do you predict that turnover will vary with the number of years of tenure that the employee already has with the firm? With the number of years of total labor market experience that the worker has? Why? A high turnover rate means that the employees’ average a shorter tenure with the firm; when the turnover rate decreases, average employee tenure goes up. The higher the total number of years in the labor market the employee has the less likely they are to leave the organization. Therefore, the lower the turnover rate. Older employees do not like to seek new positions for many reasons. They have a fear of age discrimination. They do not want the financial stress of retirement planning when retirement is so close. Studies show that older individuals are less accepting and adaptive to change. Lastly, older workers tend to lack many technical skills that are needed for new positions. 3. Currently most medical insurance in the U.S. is provided by employers. That is, it is not “portable” in that the worker cannot keep the insurance if he or she changes employers. What is the effect of this on turnover? How do you evaluate proposal to make medical insurance portable? The fact that medical insurance is provided through employers in the U.S. can help to reduce turnover, if the organization offers acceptable benefits that can support the employee and his/her family. However, if the organization’s benefits are not acceptable they will likely experience high turnover. A company’s benefits package is a great way to be competitive in the labor market and attract the best talent. COBRA is currently the best way to ensure you have benefits when transitioning employers. However, COBRA is extremely expensive and is only offered for a short amount of time during an employment transition. If absolutely needed, individuals can obtain medical insurance through a private insurance source. This can also be costly. Therefore, employees are less likely to leave and organization because their benefits are not portable. I would evaluate a proposal to make medical insurance portable by focusing on the cost of turnover and how good medical benefits helps to reduce turnover. This could be done by surveying various organization’s employees and asking which employees would seek new positions if the company did not offer medical benefits or offered portable benefits. I would predict this response to be very high – many employees would leave if the company did not offer benefits. I would then calculate the estimated cost of turnover for each of the employee that said they would leave. This would help determine the overall cost associated with not offering benefits or offering portable benefits. I would consider the administration aspect. Administering benefits can be costly. If employees were to terminate and have portable coverage the organization would still need to administer benefits to this individual.
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