Correlation and Employment – Why It Matters

Studies show that the correlation between educational attainment and work performance is fairly weak, and that IQ scores are a far better predictor of job success. If you were to select between a person with a high IQ score and a person with an average IQ score, you’d likely expect the latter to out perform the former at every job, especially when those jobs involve repetitive tasks requiring high levels of cognitive skills. But is it really possible to select the best employees for every job?

In order to accurately predict the outcome of any job, you need both IQ scores and job-specific academic knowledge. For example, the highest paying jobs involve highly intellectual individuals who excel at problem-solving. A job such as this requires individuals who can quickly adapt to changes in the economy, who are able to identify profitable trends in the market and understand the fundamental laws of supply and demand.

But in most cases, the most highly paid jobs don’t require you to possess all these characteristics. In fact, a job such as this involves routine, mundane, and boring tasks that only require little or no knowledge or skill.

Unfortunately, even people with college degrees tend to have a very difficult time finding jobs that are related to the one they hold. Even if they have the right credentials, employers prefer to work with someone who has an MBA rather than someone with only a bachelor’s degree.

You’ll notice that this is not the case in all cases. You’ll find a high correlation between college degrees and highly paid jobs.

But even for jobs with a low correlation between educational attainment and occupation, many of them still have a high correlation. The correlation is often so high that hiring a smart individual with just a bachelor’s degree will give the employer an extremely high likelihood of choosing the right individual over someone who possesses a superior knowledge base.

Because of this, employers have been looking to find ways to select people with high correlation, especially at the top levels of the company. They have begun to look at various academic achievements including SAT and GRE scores, GPA, GMAT, and other similar academic measurements. Instead of simply relying on IQ scores from standardized tests like the GRE or SAT, employers are looking at more comprehensive measures like those used by universities.

There are many companies that are now using academic assessments to select those who can perform well in their company, but whose correlation with educational achievement is low. In these cases, the company would pay someone with a very high GPA, SAT or GRE scores, GMAT, and other measures of academic success, and pay someone with a less impressive set of scores, the same level of academic success, but also a lower set of academic achievement, less money, to perform the exact identical job.

What it means for the employer is that they can select high correlation workers even without having to pay them a lot more money. This is because there are people with low academic achievement who are able to perform at a very high level in a company setting. It’s just that the employers aren’t paying them that much.

Companies have realized that in order to be competitive, they need to keep costs down and be as efficient as possible. By paying people who possess high correlation to perform the same jobs as well as those with less, the company’s ability to compete with other companies will increase.

This is why the correlation between educational achievement and job performance is so important in today’s economy. Companies are no longer trying to pay just anyone to do a job.

Because of this, those with high correlation are being offered a lot of opportunities to prove themselves in a company. They are also often the ones that are selected for promotions and better salaries, while the less successful workers are given fewer chances of getting a higher salary.