Employer Perception of New Hires: What Determines Their Overall Satisfaction with Recent Graduates?

Abstract

This study investigates how new hires are perceived by their employers in a structurally different way than previous studies that investigated employer’s satisfaction with new hires using a formative approach for measuring the construct. They looked at satisfaction as a sum of measured indicators such as oral communication or technology skills. Our model embodies a reflective-formative measurement representation. We are interested in the overall satisfaction that employers express when asked about new hires, positioning the employer as the customer in the evaluation process. Satisfaction is built as a reflective construct and operationalized accordingly. A hierarchical regression method is used to understand the impact of the independent formative variables, represented by student learning outcomes, on satisfaction. The findings led to post-hoc (PLS SEM) analysis looking at satisfaction through the lens of the stereotype content model, providing further evidence of the importance of the formative-reflective approach adopted. The findings provide a guidepost for schools of business to follow as they consider ways to make their curriculum more meaningful to the external stakeholders they serve.