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        Rejected internal applicants twice as likely to quit

        By Julie Greco |

        August 31, 2021
            

        Internal job applicants who face rejection are nearly twice
        as likely to leave their organizations than those who were
        either hired for an internal job or had not applied for a new
        job at all.

        According to new research from JR Keller, assistant professor
        of human resource studies at the ILR School, firms can
        systematically reduce the likelihood that rejected candidates
        will exit by being strategic when considering which employees
        are interviewed.

        In their paper, "Turned Down and Taking Off? Rejection and
        Turnover in Internal Talent Markets," published by the
        Academy of Management journal, Keller and co-author Kathryn
        Dlugos, M.S. '17, Ph.D. '20, assistant professor at Penn
        State University, analyzed more than 9,000 rejection
        experiences of employees at a Fortune 100 company over a
        five-year period.

        "A key insight from our work is that employees do not only
        apply for jobs they want right now; they also apply to learn
        about what jobs are more or less likely to be available to
        them in the future," Keller said. "Even if they are rejected
        today, an employee is more likely to stick around when they
        feel they have a decent shot at advancing to a new job
        tomorrow."

        As such, employees pay close attention to two aspects of the
        hiring process to determine whether they are likely to move
        into a similar role in the future.

        First, internal candidates who were rejected after
        interviewing with the hiring manager were half as likely to
        exit as those rejected earlier in the process.

        Keller and Dlugos found that getting an interview signaled to
        candidates that they have many of the characteristics needed
        to move into the job. An interview also allowed candidates to
        receive feedback from hiring managers about any knowledge and
        skills they may currently lack, as well as how to acquire
        them if they want to be hired for a similar job in the
        future.

        Second, a rejected candidate's likelihood of leaving was cut
        in half if they were passed over in favor of an internal
        candidate, rather than an external candidate.

        According to the researchers, employees believe that the past
        predicts the future. Therefore, if their organization favored
        an external candidate, they assume they will have to face
        external competition for similar jobs in the future, lowering
        their own chances of being hired. And seeing a colleague get
        hired makes employees feel as though they, too, will have a
        future opportunity to advance.

        "While we do not suggest that organizations should only hire
        internal candidates, our work does suggest that organizations
        should carefully consider whether to hire an external
        candidate when there is a viable internal candidate," the
        authors wrote. "External hires can bring valuable knowledge
        and new perspectives into the organization, but doing so also
        increases the odds that current employees will take their own
        knowledge elsewhere.

        "In short, companies that strategically manage their internal
        talent market are better positioned to keep rejected
        employees onboard."

        Julie Greco is a writer for the ILR School.

        Business, Economics & Entrepreneurship
        Media Inquiries
       
        Media Contact

        Lindsey Hadlock

        lmh267@cornell.edu
        607-269-6911
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