In the new column Friday Fact, Recruitment Tech looks at a fact about recruitment technology based on recent research. This week: 1% gender bias effect can cause losses of millions.
Research in the Journal of Management shows that even a ‘small bias’ can lead to significant damage, which assessments further down the road can no longer make up for. This we may conclude from the study with the significant title: Bias in Context: Small Biases in Hiring Evaluations Have Big Consequences.
The researchers from Oregon State University looked at biases based on the gender of the candidate. They calculated that a 1% ‘gender bias effect’ in an organization that hires some 8,000 employees results in a loss of 2.8 million euros per year. They ran a series of computer simulations to determine how organizations recruit, evaluate and select candidates. The results showed that allowing bias to persist firmly undermines the effectiveness of other recruitment efforts.