Human Resource Management

Chapter 05 - Human Resource Planning and Recruitment
Chapter 05
Human Resource Planning and Recruitment
True / False Questions
1. The first step in the human resource planning process is forecasting.

True False
2. An objective measure that accurately predicts future demand is called a nominal predictor.
True False
3. Economic planning models are useful when there is a long, stable history that can be used
to reliably detect relationships among variables.
True False
4. Change matrices are extremely useful for charting historical trends in a company's supply
of labor.
True False
5. The goals an organization sets in its human resource planning process should come directly
from the analysis of its labor supply and demand.
True False
6. As an option for avoiding an expected labor shortage, the use of overtime is a relatively fast
solution, but its use is relatively low in terms of revocability.
True False
7. As an option for avoiding an expected labor shortage, the use of new external hires is
relatively fast, but low in terms of revocability.
True False
5-1
8. In the past decade, the typical organizational response to a surplus of labor has been
downsizing, which is fast, but high in human suffering.
True False
9. One of the major reasons that organizations engaged in downsizing was that, for economic
reasons, many firms changed the location of where they did business.
True False
10. Despite the fact that baby boomers are approaching retirement, early indicators show this
group has no intention of retiring.
True False
11. An advantage of employing temporary workers is that it frees the firm from many
administrative tasks and financial burdens associated with being the "employer of record."
True False
12. Outsourcing is a logical choice when a firm does not have certain expertise and is
unwilling to invest the time and effort to develop it.
True False
13. One of the steps a company should take to ensure the success of offshoring is, when
choosing an outsourcing vendor, it is usually the smaller and older the better.
True False
14. Employers prefer hiring and training new employees rather than having to pay workers
extra for overtime production.
True False
5-2
15. The process of determining whether there are any subgroups (e.g., minorities) whose
proportion in a given job category within a company is substantially different from their
proportion in the relevant labor market is called a workforce utilization review.
True False
16. The goal of recruiting is simply to generate large numbers of applicants.

True False
17. Characteristics of a job vacancy are less important than recruiters or recruiting sources
when it comes to predicting job choice.
True False
18. Research indicates that job applicants find companies with due-process policies more
attractive than companies with employment-at-will practices.
True False
19. Image advertising is often effective because job applicants develop ideas about the general
reputation of the firm and then spill over to influence their expectations about the nature of
the specific jobs at the organization.
True False
20. Recruiting advertisements in newspapers and periodicals typically generate more desirable
recruits than direct applications or referrals.
True False
21. Private employment agencies serve primarily blue-collar workers, while public
employment agencies mostly deal with white-collar workers.
True False
5-3
22. Newspaper ads generate the largest number of recruits, but relatively few of these are
qualified for the position.
True False
23. Recruiters tend to be viewed by job seekers as less credible when they are personnel
specialists rather than subject matter experts in the job being filled.
True False
24. When applicants' reactions to recruiters are examined, age and gender are the two traits
that stand out the most.
True False
25. Research has demonstrated that the use of realistic job previews can help reduce future job
turnover in the workforce.
True False
Multiple Choice Questions
26. The first step in the human resource planning process is:
A. forecasting labor demand and supply.
B. goal setting.
C. program implementation.
D. program evaluation.
27. The process of attempting to ascertain the supply and demand for various types of human
resources is called:
A. goal setting.
B. program evaluations.
C. forecasting.
D. strategic choice.
5-4
28. An advantage of statistical forecasting methods is that:

A. under the right conditions, they provide predictions that are much more precise than
judgmental methods.
B. they are particularly useful in dynamic environments.
C. they are particularly useful if important events that occur in the labor market have no
historical precedent.
D. in the event of a legal dispute, they are more acceptable as evidence by juries.
29. Identify the correct statement about forecasting.

A. The primary goal of forecasting is to predict areas within the organization where there will
be future capital shortages or surpluses for equipment.
B. Forecasting, on both the supply and demand sides, can use either statistical methods or
judgmental methods.
C. Judgmental methods are excellent for capturing historic trends in a company's demand for
labor directional strategies.
D. Under the right conditions, judgmental methods give predictions that are much more
precise than those that could be achieved statistically.
30. Statistical planning models almost always have to be complemented by which of the
following?
A. Competitor information
B. Objective judgments of people with expertise in the area
C. Subjective judgments of people with expertise in the area
D. A prediction of the future state of the economy
31. A "leading indicator" is:

A. an objective measure that accurately predicts future labor demand.
B. a subjective measure that accurately predicts future labor supply.
C. an objective measure used to evaluate whether or not the organization successfully avoided
a pending labor shortage or surplus.
D. a subjective measure used to evaluate whether or not the organization successfully avoided
5-5
32. Identify the incorrect statement about statistical planning models.

A. These models almost always have to be complemented by subjective judgments of people
who have expertise in the area.
B. There are too many "once-in-a-lifetime" changes that have to be considered.
C. These models are useful when there is a short, stable history that can be used to reliably
detect relationships among variables.
D. The changes that have to be considered cannot be accurately captured in statistical models.
33. A(n) _____ shows the proportion of employees in different job categories at different
times.
A. employee task diagram
B. transitional matrix
C. job evaluation diagram
D. task role matrix
Refer to the following transitional matrix.
34. Which job category appears to be the most diversely staffed?

A. Credit analyst
B. Assistant manager
C. Manager
D. Clerical
5-6
35. How many career progressions (paths) are there within the organization?
A. One
B. Two
C. Three
D. Four
36. In which job category or categories were there demotions?

A. Assistant manager, credit specialist, credit analyst, regional sales representative, and sales
representative
B. Credit specialist
C. Clerical
D. Credit analyst
37. In which job category is there the greatest degree of stability?

A. Loan officer
C. Credit analyst
D. Manager
38. The goals that are set in the human resource planning process should come directly from:
A. mid-level managers, who tend to be most in touch with the organization's needs.
B. the analysis of the labor supply and demand.
C. the strategic choices that are made.
D. the feedback provided by the organization's customers.
39. An organization seeking to reduce a projected labor surplus must select from a number of
possible options aimed at obtaining that objective (e.g., retirements, layoffs, work sharing,
etc.). This occurs at what step in the human resource planning process?
A. Goal setting and strategic planning
B. Program evaluation
C. Forecasting
D. Program implementation
5-7
40. The purpose of setting specific quantitative goals is:

A. to make sure that some individual is held accountable for achieving the stated goals.
B. to ascertain whether or not the company has successfully avoided any potential labor
surpluses or shortages.
C. to focus attention on the problem and provide a benchmark for determining the relative
success of any programs aimed at redressing a pending labor shortage or surplus.
D. to predict areas within the organization where there will be future labor shortages or
surpluses.
41. Which of the following options for reducing an expected labor surplus has the benefit of
being a relatively fast solution, but the disadvantage of being high in human suffering?
A. Downsizing
B. Retirement
C. Retraining
D. Work sharing
42. Your company's primary concern is to reduce an expected labor surplus fast; its secondary
concern is to minimize human suffering. The options that would best address the company's
concerns (in the priority indicated) are:
A. layoffs and transfers.
B. transfers and work sharing.
C. retirement and retraining.
D. natural attrition and transfers.
43. Forecasting indicates your company needs to reduce its white-collar workforce in order to
avoid a labor surplus in the next three to five years. Consistent with the corporate culture it
wants to maintain, your company places a higher priority on minimizing human suffering than
on achieving the labor reduction quickly. The options that are most consistent with these
priorities are:
A. demotions and transfers.
5-8
44. A small company that manufactures special-order wood furniture has kept its employees
busy on a 40-hour-a-week schedule for the past two years. The company just received the
largest contract in its history from a Saudi company opening offices in the area. There is no
expectation of repeat business from the Saudi company. In order to complete the contract in
the required six months, additional skilled woodworking manpower is needed. Under these
circumstances, to avoid an expected labor shortage, the best option would be:
A. overtime.
B. retrained transfers.
C. turnover reduction.
D. new external hires.
45. Which of the following options for avoiding an expected labor shortage has the benefit of
being a relatively fast solution with high revocability?
A. Temporary employees
B. Technological innovation
C. Turnovers
D. New external hires
46. The most typical organizational responses to an expected labor shortage are:
A. fast response and low revocability.
B. fast response and high revocability.
C. slow response and high revocability.
D. slow response and low revocability.
47. Which of the following options for reducing an expected labor surplus is a relatively slow
solution, but offers the benefit of being low in human suffering?
A. Work sharing
B. Demotion
C. Retirement
D. Transfers
5-9
48. Which of the following is not a major reason organizations engage in downsizing?
A. To stem current losses
B. To reduce future labor costs
C. To close outdated plants or introduce technological changes to old plants
D. To change the location of business due to economic reasons
49. Reasons for the failure of most downsizing efforts to live up to expectations include all of
the following except:
A. downsizing efforts eliminate people who turn out to be irreplaceable assets.
B. short-term cost savings often turn negative in the long term.
C. downsizing efforts reduce a firm's competitiveness.
D. employees who survive downsizing become narrow-minded and risk-adverse.
50. This act requires that employers give workers 60 days warning regarding layoffs, as well
as severance pay.
A. Employer's Liability Act
B. Worker Adjustment and Retraining Notification Act
C. Age Discrimination in Employment Act
D. Equal Pay Act
51. The key to a successful downsizing effort is to:

A. perform surgical strategic cuts.
B. perform indiscriminant across-the-board cuts.
C. downsize at random.
D. cut the oldest and best-paid employees first.
52. Which of the following statements about older workers is false?

A. The average age of the U.S. workforce is increasing.
B. Many baby boomers are approaching traditional retirement age.
C. Early indications are that the baby boomers group has every intention of retiring soon.
D. The decreased physical labor in many jobs has made working longer a viable option.
5-10
53. Which of the following statements about older workers as compared to younger workers is
false?
A. Older workers are sometimes more costly than younger workers.
B. When the value of experience offsets higher costs of keeping older workers, then
employers are fine.
C. Because younger workers typically occupy the best-paid jobs, they sometimes block the
advancement of older workers.
D. When the value of the experience does not offset costs, it becomes difficult to pass higher
costs to consumers.
54. In the face of demographic pressures dealing with an aging workforce, many employers
try to induce _____ among their older workers through early retirement incentive programs.
A. wage and salary penalties
B. work penalties
C. involuntary attrition
D. voluntary attrition
55. Which of the following is not an advantage of employing temporary workers as a means
of eliminating a labor shortage?
A. The use of temporary workers frees the firm from many administrative tasks and financial
burdens associated with being the "employer of record."
B. Since temporary workers are just that, they do not pose a threat to current employees in
terms of job security.
C. Many temporary agencies train employees prior to sending them over to employers, which
reduces training costs and eases the transition of both the temporary worker and the company.
D. Temporary workers have little experience in the host firm, thus they bring an objective
perspective to the organization's problems and procedures that is sometimes valuable.
56. Identify the incorrect statement about temporary workers.

A. Firms are more likely to derive performance benefits from temporary employees when the
current set of workers perceive their job security is low relative to when they feel threatened.
B. There is often tension between a firm's temporary employees and its full-time employees.
C. Some full-time employees perceive the temporary help as a threat to their own job security.
D. Instead of replacing long-term employees with temporary employees, many organizations
supplement their core staff with a small set of temporary workers who act more like assistants
to the core staff than potential replacements.
5-11
57. All of the following about outsourcing are true except one. Name the exception.
A. Outsourcing is a logical choice when firms lack experience in an area.
B. Offshoring is a form of outsourcing.
C. Technological advancements have slowed the momentum of outsourcing being done today.
D. Outsourcing is driven by economies of scale.
58. A special case of outsourcing where the jobs that move actually leave one country and go
to another is called:
A. insourcing.
B. out-distancing.
C. offshoring.
D. overseas sourcing.
59. All of the following have contributed to wiping out the cost savings attributed to lower
wages created by offshoring except:
A. quality control problems.
B. employees weak work ethic.
C. security violations.
D. poor customer service experiences.
60. Identify the correct statement about offshoring.

A. When choosing an outsourcing vendor, it is usually the smaller and older the better.
B. Small overseas upstarts do not take risks that one is likely to see in larger, more established
contractors.
C. Any work that is proprietary should be offshored.
D. Small overseas upstarts often promise more than they can deliver.
61. When a company faces a shortage of labor:

A. it has the option of trying to garner more hours out of the existing labor force.
B. having to pay workers time-and-a-half for overtime production is not an option.
C. employers prefer hiring and training new employees.
D. employers prefer hiring part-time employees only.
5-12
62. Identify the correct statement about furloughs.

A. They hit lower-paid employees harder than higher-paid employees.
B. The work of most blue-collar professionals simply piles up when they leave the office for
even short periods of time.
C. If pay differences are a result of some type of pay-for performance system, then the best
employees take the biggest hit.
D. They are a long-term elimination of paid workdays applied to salaried workers.
63. The programs developed in the strategic-choice stage of the process are put into practice
in the:
A. forecasting stage.
B. goal-setting stage.
C. evaluation stage.
D. program-implementation stage.
64. A critical aspect of the program implementation step of human resource planning is:
A. the setting of a benchmark for determining the relative success of a program.
B. selecting the best option for redressing a pending labor shortage or surplus.
C. making sure that some individual is held accountable for achieving the stated goals.
D. ascertaining whether or not the company has successfully avoided any potential labor
65. The final step in the planning process is to:

A. evaluate results.
B. set goals and objectives.
C. formulate strategies.
D. establish forecasting methods.
5-13
66. The process of determining whether there are any subgroups (e.g., minorities or disabled)
whose proportion in a given job category within a company is substantially different from
their proportion in the relevant labor market is called:
A. adverse treatment analysis.
B. workforce utilization review.
C. subgroup reconciliation.
D. discrimination analysis.
67. _____ forecast and monitor the proportion of various protected group members, such as
women and minorities, that are in various job categories and career tracks.
A. Ethnocracies
B. Group rights
C. Affirmative action plans
D. Employment background checks
68. _____ requires that government contractors and subcontractors maintain affirmative
action programs.
A. Executive Order 11246
B. Title VII
C. Executive Order 11478
D. The Civil Rights Act of 1991
69. Recruitment activities are designed to affect all of the following except:
A. the number of people who apply for vacancies.
B. the type of people who apply for vacancies.
C. the likelihood that those applying for vacancies will accept positions if offered.
D. the evaluation of employees once hired.
70. The goals of personnel recruitment include all but one of the following. Name the
exception.
A. To increase the number of people who apply for vacancies.
B. To control the type of people who apply for vacancies.
C. To finely discriminate among reasonably qualified applicants.
D. To inflate the number of applicants for statistical purposes.
5-14
71. Which of the following types of interviews has the highest validity in terms of making
effective screening decisions?
A. Focus groups
B. Highly structured interviews
C. Questionnaires
D. Highly unstructured interviews
72. Which of the following tends to have the most positive influence on job choice decisions?
A. The kind of recruiters used
B. The recruitment sources
C. The use of realistic job previews
D. Job vacancy characteristics
73. An approach that pays higher than current market wages is called a:
A. premium-wage approach.
B. lead-indicator approach.
C. lead-the-market approach.
D. first-mover approach.
74. Organizational recruitment materials that emphasize due process, rights of appeal, and
grievance mechanisms send a message that:
A. the organization has many problems.
B. the organization values employee rights over productivity and profitability.
C. job security is high in the organization.
D. employee morale is low in the organization.
75. Policies that state that either party in the employment relationship can terminate that
relationship at any time, regardless of cause are called:
A. due process policies.
B. employment-at-will policies.
C. employee liability policies.
D. freedom-to-work policies.
5-15
76. A policy that lays out the steps an employee can take to appeal a termination decision is
called a(n):
A. due process policy.
B. employment-at-will policy.
C. outsourcing policy.
D. affirmative action policy.
77. The U.S. Army's "Be all you can be" campaign is an example of:
A. general advertising.
B. reputation advertising.
C. image advertising.
D. proactive advertising.
78. The sources from which companies recruit potential employees are:
A. dictated largely by legal constraints.
B. determined by demographic patterns.
C. typically regulated by industry standards.
D. a critical aspect of its overall recruitment strategy.
79. Which of the following is an advantage of relying on internal recruitment sources?

A. They are likely to increase diversity.
B. They minimize the impact of political considerations in the hiring decision.
C. They are generally cheaper and faster than other means.
D. They will increase innovation within an organization.
80. Which of the following best exemplifies the process of self-selection?

A. An applicant posts his/her resume on an online job bulletin board.
B. While at a job fair, an applicant decides to interview with the ABC Company.
C. An applicant is asked to return for a second interview with the ABC Company.
D. An applicant takes an online "job fitness" test before deciding to apply to the ABC
Company.
5-16
81. Recruiting advertisements in newspapers and periodicals:

A. are exempt from the requirements of Title VII.
B. are most effective in attracting applicants who are currently employed.
C. are generally not needed.
D. typically generate less desirable recruits than direct applications or referrals.
82. The most effective source for recruiters is:

A. referrals.
B. job fairs.
C. the Web.
D. local newspapers.
83. Van Roehling Inc., located in a small town 40 miles from Detroit, is seeking to hire 10
production workers. The company also wants very much to improve the diversity of its
presently all-white, male workforce. Which of the following combinations of recruitment
sources would be the best for the company to use?
A. Referrals from current employees and walk-in applicants.
B. A job search firm and an advertisement in the local newspaper.
C. Referrals from current employees and an advertisement in the local newspaper.
D. Advertisement in a metropolitan Detroit newspaper and Michigan's public employment
service.
84. Executive search firms (ESFs):

A. serve as an important confidentiality buffer between the employer and the recruit.
B. work almost exclusively with high-level, unemployed executives.
C. typically require the person being placed to make the initial contact with the prospective
employer directly.
D. are not subject to the requirements of Title VII.
5-17
85. Yield ratios express the:

A. output yielded by a new hire in relation to the cost of recruiting the new hire.
B. percentage of applicants who successfully move from one stage of the recruitment and
selection process to the next.
C. dollar costs per hire.
D. quality of new hires by comparing the cost of training the new recruits to the cost of hiring
them.
86. Cost per hire is:

A. useful in establishing the efficiency of a recruiting source.
B. lower for private employment agencies than for public employment agencies.
C. lower for executive recruits than for clerical recruits.
D. a measure of applicant quality.
87. The recruiting source that is likely to be least costly per recruit hired is:
A. a renowned university.
B. newspaper ads.
C. an employee referral.
D. an executive search firm.
88. The recruiting source that is likely to have the highest yield ratio is:
A. a college/university.
B. walk-ins.
C. a public employment agency.
89. Which of the following recruiter characteristics do applicants tend to respond to most
positively?
A. Warmth
B. Race (same as applicant)
C. Age
D. Gender
5-18
90. All but one of the following would enhance recruiter effectiveness. Name the exception.
A. Ensure recruiters provide applicants with timely feedback.
B. Conduct dual-purpose recruitment and selection interviews.
C. Ensure recruiters are knowledgeable about company policies and procedures and the
characteristics of the position.
D. Do recruiting in teams rather than individually.
Essay Questions
91. Until recently, Donnelly Inc. manufactured mirrors that were sold exclusively to the "Big
Three" automobile makers. In the past year, following the loss of the General Motors account,
the company landed substantial accounts (30 percent of current business) with Toyota and
Honda. These new clients need somewhat different products, which require a more laborintensive production process. Also, the new clients have leaner inventory systems than the Big
Three. Under these circumstances, what kind of method would be most appropriate to use in
forecasting the company's labor demand in the upcoming year: a statistical approach or a
judgmental approach? Explain your answer.
92. Describe what occurs at the goal setting and strategic planning step of the human resource
planning process.
5-19
93. Discuss the major options organizations have for reducing labor surpluses. In doing so,
discuss how they vary in terms of speed and the amount of human suffering.
94. Forecasting indicates the need for skilled technical employees in your company will
increase dramatically this year. If the company continues on its present course, it will
experience a substantial labor shortage by year's end. Something must be done fast, but
management is concerned about maintaining its flexibility. Which of the options for avoiding
expected labor shortages identified in the text would be most appropriate under these
circumstances? Explain your answer.
95. What is downsizing? Discuss the four major reasons why organizations engage in
downsizing. In general, are downsizing strategies successful? List reasons why or why not.
5-20
96. Discuss the advantages and disadvantages of using temporary employees as an option in
response to labor shortages.
97. Describe outsourcing and offshoring and provide examples. Why are they used? What are
some of the problems with these efforts? When is it a good idea to use outsourcing or
offshoring?
98. Discuss the relative merit of internal versus external recruiting.
5-21
99. In the next six months, your company needs to hire 35 external new hires for production
assembly and machine shop positions. In the past, your company has had difficulty in meeting
its affirmative action goals in terms of percentage of minorities among new hires. For each of
the following recruitment sources, state whether you would use the source in your recruitment
program and explain why or why not: (1) referrals from current employees, (2) public
employment agencies, and (3) executive search firms.
100. Compare and contrast the following recruiting sourcesexecutive search firms,
employee referrals, newspaper advertising, and colleges/universitiesin terms of efficiency
(cost per hire) and quality (yield ratio).
5-22
Chapter 05 Human Resource Planning and Recruitment Answer Key
True / False Questions
1. (p. 193) The first step in the human resource planning process is forecasting.
TRUE
AACSB: Business Knowledge and Analytic Skills

BT: Knowledge
Difficulty: Easy
Learning Objective: 5-1
Topic: Forecasting
2. (p. 194) An objective measure that accurately predicts future demand is called a nominal
predictor.
FALSE
AACSB: Business Knowledge and Analytic Skills, Domestic and Global Economic Environments of Organizations
BT: Knowledge
Difficulty: Medium
Topic: Determining Labor Demand
3. (p. 195) Economic planning models are useful when there is a long, stable history that can be
used to reliably detect relationships among variables.
FALSE
AACSB: Reflective Thinking Skills, Statistical Data Analysis & Management Science
BT: Knowledge
Difficulty: Easy
5-23
4. (p. 195) Change matrices are extremely useful for charting historical trends in a company's
supply of labor.
FALSE
AACSB: Reflective Thinking Skills

BT: Knowledge
Difficulty: Easy
Topic: Determining Labor Supply
5. (p. 197) The goals an organization sets in its human resource planning process should come
directly from the analysis of its labor supply and demand.
TRUE

BT: Knowledge
Difficulty: Easy
Topic: Goal Setting and Strategic Planning
6. (p. 198) As an option for avoiding an expected labor shortage, the use of overtime is a
relatively fast solution, but its use is relatively low in terms of revocability.
FALSE

BT: Knowledge
Difficulty: Medium
7. (p. 198) As an option for avoiding an expected labor shortage, the use of new external hires is
relatively fast, but low in terms of revocability.
FALSE

BT: Knowledge
Difficulty: Medium
5-24
8. (p. 198) In the past decade, the typical organizational response to a surplus of labor has been
downsizing, which is fast, but high in human suffering.
TRUE

BT: Knowledge
Difficulty: Medium
9. (p. 199) One of the major reasons that organizations engaged in downsizing was that, for
economic reasons, many firms changed the location of where they did business.
TRUE

BT: Knowledge
Difficulty: Medium
Topic: Downsizing
10. (p. 201) Despite the fact that baby boomers are approaching retirement, early indicators show
this group has no intention of retiring.
TRUE

BT: Knowledge
Difficulty: Medium
Topic: Early Retirement Programs and Buyouts
11. (p. 204) An advantage of employing temporary workers is that it frees the firm from many
administrative tasks and financial burdens associated with being the "employer of record."
TRUE

BT: Comprehension
Difficulty: Medium
Topic: Employing Temporary Workers
5-25
12. (p. 205) Outsourcing is a logical choice when a firm does not have certain expertise and is
unwilling to invest the time and effort to develop it.
TRUE

BT: Knowledge
Difficulty: Easy
Topic: Outsourcing and Offshoring
13. (p. 207) One of the steps a company should take to ensure the success of offshoring is, when
choosing an outsourcing vendor, it is usually the smaller and older the better.
FALSE

BT: Comprehension
Difficulty: Medium
14. (p. 208) Employers prefer hiring and training new employees rather than having to pay
workers extra for overtime production.
FALSE

BT: Comprehension
Difficulty: Medium
Topic: Altering Pay and Hours
15. (p. 209) The process of determining whether there are any subgroups (e.g., minorities) whose
proportion in a given job category within a company is substantially different from their
proportion in the relevant labor market is called a workforce utilization review.
TRUE

BT: Knowledge
Difficulty: Medium
Topic: The Special Case of Affirmative Action Planning
5-26
16. (p. 210) The goal of recruiting is simply to generate large numbers of applicants.
FALSE

BT: Knowledge
Difficulty: Medium
Topic: The Human Resource Recruitment Process
17. (p. 211) Characteristics of a job vacancy are less important than recruiters or recruiting
sources when it comes to predicting job choice.
FALSE

BT: Knowledge
Difficulty: Medium
Topic: Personnel Policies
18. (p. 212) Research indicates that job applicants find companies with due-process policies
more attractive than companies with employment-at-will practices.
TRUE

BT: Knowledge
Difficulty: Medium
Topic: Internal versus External Recruiting: Job Security
19. (p. 214) Image advertising is often effective because job applicants develop ideas about the
general reputation of the firm and then spill over to influence their expectations about the
nature of the specific jobs at the organization.
TRUE

BT: Knowledge
Difficulty: Medium
Topic: Image Advertising
5-27
20. (p. 216) Recruiting advertisements in newspapers and periodicals typically generate more
desirable recruits than direct applications or referrals.
FALSE

BT: Knowledge
Difficulty: Medium
Topic: Advertisements in Newspapers and Periodicals
21. (p. 220) Private employment agencies serve primarily blue-collar workers, while public
employment agencies mostly deal with white-collar workers.
FALSE

BT: Knowledge
Difficulty: Easy
Topic: Public and Private Employment Agencies
22. (p. 221) Newspaper ads generate the largest number of recruits, but relatively few of these
are qualified for the position.
TRUE

BT: Knowledge
Difficulty: Medium
Topic: Evaluating the Quality of a Source
23. (p. 222) Recruiters tend to be viewed by job seekers as less credible when they are personnel
specialists rather than subject matter experts in the job being filled.
TRUE

BT: Knowledge
Difficulty: Medium
Topic: Recruiters
5-28
24. (p. 222) When applicants' reactions to recruiters are examined, age and gender are the two
traits that stand out the most.
FALSE

BT: Knowledge
Difficulty: Easy
Topic: Recruiters
25. (p. 223) Research has demonstrated that the use of realistic job previews can help reduce
future job turnover in the workforce.
TRUE

BT: Knowledge
Difficulty: Medium
Topic: Recruiters
Multiple Choice Questions
26. (p. 193) The first step in the human resource planning process is:
A. forecasting labor demand and supply.
B. goal setting.
C. program implementation.
D. program evaluation.
The human resource planning process consists of forecasting, goal setting and strategic
planning, and program implementation and evaluation.

BT: Knowledge
Difficulty: Easy
Topic: Forecasting
5-29
27. (p. 193) The process of attempting to ascertain the supply and demand for various types of
human resources is called:
A. goal setting.
B. program evaluations.
C. forecasting.
D. strategic choice.
In personnel forecasting, the HR manager attempts to ascertain the supply of and demand for
various types of human resources.

BT: Knowledge
Difficulty: Easy
Topic: Forecasting
28. (p. 193) An advantage of statistical forecasting methods is that:

A. under the right conditions, they provide predictions that are much more precise than
judgmental methods.
B. they are particularly useful in dynamic environments.
C. they are particularly useful if important events that occur in the labor market have no
historical precedent.
D. in the event of a legal dispute, they are more acceptable as evidence by juries.
Statistical methods are excellent for capturing historic trends in a company's demand for
labor, and under the right conditions they give predictions that are much more precise than
those that could be achieved through subjective judgments of a human forecaster.
AACSB: Reflective Thinking Skills, Statistical Data Analysis & Management Science
BT: Comprehension
Difficulty: Medium
Topic: Forecasting
5-30
29. (p. 193-194) Identify the correct statement about forecasting.

A. The primary goal of forecasting is to predict areas within the organization where there will
be future capital shortages or surpluses for equipment.
B. Forecasting, on both the supply and demand sides, can use either statistical methods or
judgmental methods.
C. Judgmental methods are excellent for capturing historic trends in a company's demand for
labor directional strategies.
D. Under the right conditions, judgmental methods give predictions that are much more
precise than those that could be achieved statistically.
Typically, because of the complementary strengths and weaknesses of the two methods,
companies that engage in human resource planning use a balanced approach that includes
both statistical and judgmental components.

BT: Comprehension
Difficulty: Medium
Topic: Forecasting
30. (p. 194) Statistical planning models almost always have to be complemented by which of the
following?
A. Competitor information
B. Objective judgments of people with expertise in the area
C. Subjective judgments of people with expertise in the area
D. A prediction of the future state of the economy
Many important events that occur in the labor market have no historical precedent; hence,
statistical methods that work from historical trends are of little use in such cases. With no
historical precedent, one must rely on the pooled subjective judgments of experts.

BT: Knowledge
Difficulty: Medium
Topic: Forecasting
5-31
31. (p. 194) A "leading indicator" is:

A. an objective measure that accurately predicts future labor demand.
B. a subjective measure that accurately predicts future labor supply.
C. an objective measure used to evaluate whether or not the organization successfully avoided
D. a subjective measure used to evaluate whether or not the organization successfully avoided
At the most sophisticated level, an organization might have statistical models that predict
labor demand for the next year given relatively objective statistics on leading indicators from
the previous year.

BT: Knowledge
Difficulty: Medium
32. (p. 195) Identify the incorrect statement about statistical planning models.
A. These models almost always have to be complemented by subjective judgments of people
who have expertise in the area.
B. There are too many "once-in-a-lifetime" changes that have to be considered.
C. These models are useful when there is a short, stable history that can be used to reliably
detect relationships among variables.
D. The changes that have to be considered cannot be accurately captured in statistical models.
Statistical planning models are useful when there is a long, stable history that can be used to
reliably detect relationships among variables.

BT: Comprehension
Difficulty: Medium
5-32
33. (p. 195) A(n) _____ shows the proportion of employees in different job categories at
different times.
A. employee task diagram
B. transitional matrix
C. job evaluation diagram
D. task role matrix
Typically transitional matrices show how people move in one year from one state (outside the
organization) or job category to another state or job category.

BT: Knowledge
Difficulty: Medium
Refer to the following transitional matrix.
5-33
34. (p. 196) Which job category appears to be the most diversely staffed?
A. Credit analyst
C. Manager
D. Clerical
Transitional matrices show the proportion (or number) of employees in different job
categories at different times.

BT: Application
Difficulty: Hard
35. (p. 196) How many career progressions (paths) are there within the organization?
A. One
B. Two
C. Three
D. Four

BT: Application
Difficulty: Hard
5-34
36. (p. 196) In which job category or categories were there demotions?
A. Assistant manager, credit specialist, credit analyst, regional sales representative, and sales
representative
B. Credit specialist
C. Clerical
D. Credit analyst

BT: Application
Difficulty: Hard
37. (p. 196) In which job category is there the greatest degree of stability?
A. Loan officer
C. Credit analyst
D. Manager

BT: Application
Difficulty: Hard
5-35
38. (p. 197) The goals that are set in the human resource planning process should come directly
from:
A. mid-level managers, who tend to be most in touch with the organization's needs.
B. the analysis of the labor supply and demand.
C. the strategic choices that are made.
D. the feedback provided by the organization's customers.
The goals should come directly from the analysis of labor supply and demand and should
include a specific figure for what should happen with the job category or skill area and a
specific timetable for when results should be achieved.

BT: Knowledge
Difficulty: Easy
39. (p. 197) An organization seeking to reduce a projected labor surplus must select from a
number of possible options aimed at obtaining that objective (e.g., retirements, layoffs, work
sharing, etc.). This occurs at what step in the human resource planning process?
A. Goal setting and strategic planning
B. Program evaluation
C. Forecasting
D. Program implementation
The purpose of setting specific quantitative goals is to focus attention on the problem and
provide a benchmark for determining the relative success of any programs aimed at redressing

BT: Application
Difficulty: Easy
5-36
40. (p. 197) The purpose of setting specific quantitative goals is:
A. to make sure that some individual is held accountable for achieving the stated goals.
B. to ascertain whether or not the company has successfully avoided any potential labor
C. to focus attention on the problem and provide a benchmark for determining the relative
success of any programs aimed at redressing a pending labor shortage or surplus.
D. to predict areas within the organization where there will be future labor shortages or
surpluses.
The goals should come directly from the analysis of labor supply and demand and should
include a specific figure for what should happen with the job category or skill area and a
specific timetable for when results should be achieved.

BT: Knowledge
Difficulty: Medium
41. (p. 198) Which of the following options for reducing an expected labor surplus has the
benefit of being a relatively fast solution, but the disadvantage of being high in human
suffering?
A. Downsizing
B. Retirement
C. Retraining
D. Work sharing
Downsizing is the planned elimination of large numbers of personnel designed to enhance
organizational effectiveness.

BT: Knowledge
Difficulty: Medium
5-37
42. (p. 198) Your company's primary concern is to reduce an expected labor surplus fast; its
secondary concern is to minimize human suffering. The options that would best address the
company's concerns (in the priority indicated) are:
A. layoffs and transfers.
The typical organizational response to a surplus of labor has been downsizing, which is fast
but high in human suffering.

BT: Comprehension
Difficulty: Hard
43. (p. 198) Forecasting indicates your company needs to reduce its white-collar workforce in
order to avoid a labor surplus in the next three to five years. Consistent with the corporate
culture it wants to maintain, your company places a higher priority on minimizing human
suffering than on achieving the labor reduction quickly. The options that are most consistent
with these priorities are:
A. demotions and transfers.
The typical organizational response to a surplus of labor has been downsizing, which is fast
but high in human suffering.

BT: Application
Difficulty: Hard
5-38
44. (p. 198) A small company that manufactures special-order wood furniture has kept its
employees busy on a 40-hour-a-week schedule for the past two years. The company just
received the largest contract in its history from a Saudi company opening offices in the area.
There is no expectation of repeat business from the Saudi company. In order to complete the
contract in the required six months, additional skilled woodworking manpower is needed.
Under these circumstances, to avoid an expected labor shortage, the best option would be:
A. overtime.
B. retrained transfers.
C. turnover reduction.
D. new external hires.
The second step in human resource planning is goal setting and strategic planning. The goals
should come directly from the analysis of labor supply and demand and should include a
specific figure for what should happen with the job category or skill area and a specific
timetable for when results should be achieved.

BT: Application
Difficulty: Hard
45. (p. 198) Which of the following options for avoiding an expected labor shortage has the
benefit of being a relatively fast solution with high revocability?
A. Temporary employees
B. Technological innovation
C. Turnovers
D. New external hires

BT: Knowledge
Difficulty: Medium
5-39
46. (p. 198) The most typical organizational responses to an expected labor shortage are:
A. fast response and low revocability.
B. fast response and high revocability.
C. slow response and high revocability.
D. slow response and low revocability.

BT: Knowledge
Difficulty: Medium
47. (p. 198) Which of the following options for reducing an expected labor surplus is a relatively
slow solution, but offers the benefit of being low in human suffering?
A. Work sharing
B. Demotion
C. Retirement
D. Transfers

BT: Knowledge
Difficulty: Medium
5-40
48. (p. 199) Which of the following is not a major reason organizations engage in downsizing?
A. To stem current losses
B. To reduce future labor costs
C. To close outdated plants or introduce technological changes to old plants
D. To change the location of business due to economic reasons
We define downsizing as the planned elimination of large numbers of personnel designed to
enhance organizational effectiveness.

BT: Comprehension
Difficulty: Medium
Topic: Downsizing
49. (p. 199, 201) Reasons for the failure of most downsizing efforts to live up to expectations
include all of the following except:
A. downsizing efforts eliminate people who turn out to be irreplaceable assets.
B. short-term cost savings often turn negative in the long term.
C. downsizing efforts reduce a firm's competitiveness.
D. employees who survive downsizing become narrow-minded and risk-adverse.
There are a number of reasons for the failure of most downsizing efforts to live up to
expectations in terms of enhancing firm performance.

BT: Comprehension
Difficulty: Medium
Topic: Downsizing
5-41
50. (p. 201) This act requires that employers give workers 60 days warning regarding layoffs, as
well as severance pay.
A. Employer's Liability Act
B. Worker Adjustment and Retraining Notification Act
C. Age Discrimination in Employment Act
D. Equal Pay Act
Many employers seem to be unaware of this act, and because of the recession, there was spike
in lawsuits in 2009 based upon this act.
AACSB: Business Knowledge and Analytic Skills, Ethical/Legal Responsibilities in Organizations & Society
BT: Knowledge
Difficulty: Medium
Topic: Downsizing
51. (p. 201) The key to a successful downsizing effort is to:

A. perform surgical strategic cuts.
B. perform indiscriminant across-the-board cuts.
C. downsize at random.
D. cut the oldest and best-paid employees first.
The key to a successful downsizing effort is to avoid indiscriminant across-the-board cuts,
and instead perform surgical strategic cuts that not only reduce costs, but also improve the
firm's competitive position.

BT: Comprehension
Difficulty: Medium
Topic: Downsizing
5-42
52. (p. 201) Which of the following statements about older workers is false?
A. The average age of the U.S. workforce is increasing.
B. Many baby boomers are approaching traditional retirement age.
C. Early indications are that the baby boomers group has every intention of retiring soon.
D. The decreased physical labor in many jobs has made working longer a viable option.
Although many baby boomers are approaching traditional retirement age, early indications are
that this group has no intention of retiring any time soon.

BT: Comprehension
Difficulty: Medium
Topic: Downsizing
53. (p. 202) Which of the following statements about older workers as compared to younger
workers is false?
A. Older workers are sometimes more costly than younger workers.
B. When the value of experience offsets higher costs of keeping older workers, then
employers are fine.
C. Because younger workers typically occupy the best-paid jobs, they sometimes block the
advancement of older workers.
D. When the value of the experience does not offset costs, it becomes difficult to pass higher
costs to consumers.
Because older workers typically occupy the best-paid jobs, they sometimes prevent the hiring
or block the advancement of younger workers.

BT: Knowledge
Difficulty: Medium
5-43
54. (p. 202) In the face of demographic pressures dealing with an aging workforce, many
employers try to induce _____ among their older workers through early retirement incentive
programs.
A. wage and salary penalties
B. work penalties
C. involuntary attrition
D. voluntary attrition
Although some research suggests that these programs do induce attrition among lowerperforming older workers, to a large extent, such programs' success is contingent upon
accurate forecasting.

BT: Knowledge
Difficulty: Medium
55. (p. 204-205) Which of the following is not an advantage of employing temporary workers as a
means of eliminating a labor shortage?
A. The use of temporary workers frees the firm from many administrative tasks and financial
burdens associated with being the "employer of record."
B. Since temporary workers are just that, they do not pose a threat to current employees in
terms of job security.
C. Many temporary agencies train employees prior to sending them over to employers, which
reduces training costs and eases the transition of both the temporary worker and the company.
D. Temporary workers have little experience in the host firm, thus they bring an objective
perspective to the organization's problems and procedures that is sometimes valuable.
Surveys indicate that 33 percent of full-time employees perceive the temporary help as a
threat to their own job security.

BT: Comprehension
Difficulty: Medium
5-44
56. (p. 205) Identify the incorrect statement about temporary workers.
A. Firms are more likely to derive performance benefits from temporary employees when the
current set of workers perceive their job security is low relative to when they feel threatened.
B. There is often tension between a firm's temporary employees and its full-time employees.
C. Some full-time employees perceive the temporary help as a threat to their own job security.
D. Instead of replacing long-term employees with temporary employees, many organizations
supplement their core staff with a small set of temporary workers who act more like assistants
to the core staff than potential replacements.
Surveys indicate that 33 percent of full-time employees perceive the temporary help as a
threat to their own job security.

BT: Comprehension
Difficulty: Medium
57. (p. 205-206) All of the following about outsourcing are true except one. Name the exception.
A. Outsourcing is a logical choice when firms lack experience in an area.
B. Offshoring is a form of outsourcing.
C. Technological advancements have slowed the momentum of outsourcing being done today.
D. Outsourcing is driven by economies of scale.
Outsourcing is an organization's use of an outside organization for a broad set of services.

BT: Comprehension
Difficulty: Medium
5-45
58. (p. 206) A special case of outsourcing where the jobs that move actually leave one country
and go to another is called:
A. insourcing.
B. out-distancing.
C. offshoring.
D. overseas sourcing.
Outsourcing is aimed at simply reducing costs by hiring less expensive labor to do the work,
and, more often than not, this means moving the work outside the country.

BT: Knowledge
Difficulty: Easy
59. (p. 207) All of the following have contributed to wiping out the cost savings attributed to
lower wages created by offshoring except:
A. quality control problems.
B. employees weak work ethic.
C. security violations.
D. poor customer service experiences.
Outsourcing is aimed at simply reducing costs by hiring less expensive labor to do the work,
and, more often than not, this means moving the work outside the country.

BT: Comprehension
Difficulty: Medium
5-46
60. (p. 207) Identify the correct statement about offshoring.

A. When choosing an outsourcing vendor, it is usually the smaller and older the better.
B. Small overseas upstarts do not take risks that one is likely to see in larger, more established
contractors.
C. Any work that is proprietary should be offshored.
D. Small overseas upstarts often promise more than they can deliver.
When choosing an outsourcing vendor, it is usually the bigger and older the better. Small
overseas upstarts often promise more than they can deliver and take risks that one is not likely
to see in larger, more established contractors.

BT: Comprehension
Difficulty: Medium
61. (p. 208) When a company faces a shortage of labor:

A. it has the option of trying to garner more hours out of the existing labor force.
B. having to pay workers time-and-a-half for overtime production is not an option.
C. employers prefer hiring and training new employees.
D. employers prefer hiring part-time employees only.
Despite having to pay workers time-and-a-half for overtime production, employers see this as
preferable to hiring and training new employeesespecially if they are afraid that current
demand for products or services may not extend to the future.

BT: Comprehension
Difficulty: Medium
5-47
62. (p. 209) Identify the correct statement about furloughs.

A. They hit lower-paid employees harder than higher-paid employees.
B. The work of most blue-collar professionals simply piles up when they leave the office for
even short periods of time.
C. If pay differences are a result of some type of pay-for performance system, then the best
employees take the biggest hit.
D. They are a long-term elimination of paid workdays applied to salaried workers.
Furloughs are controversial because they hit higher-paid employees harder than lower-paid
employees, and if these pay differences were a result of some type of pay-for performance
system, this means that the best employees take the biggest hit.

BT: Knowledge
Difficulty: Medium
63. (p. 209) The programs developed in the strategic-choice stage of the process are put into
practice in the:
A. forecasting stage.
B. goal-setting stage.
C. evaluation stage.
D. program-implementation stage.
A critical aspect of program implementation is to make sure that some individual is held
accountable for achieving the stated goals and has the necessary authority and resources to
accomplish this goal.

BT: Knowledge
Difficulty: Medium
Topic: Program Implementation and Evaluation
5-48
64. (p. 209) A critical aspect of the program implementation step of human resource planning is:
A. the setting of a benchmark for determining the relative success of a program.
B. selecting the best option for redressing a pending labor shortage or surplus.
C. making sure that some individual is held accountable for achieving the stated goals.
D. ascertaining whether or not the company has successfully avoided any potential labor
The programs developed in the strategic-choice stage of the process are put into practice in
the program-implementation stage.

BT: Knowledge
Difficulty: Medium
65. (p. 209) The final step in the planning process is to:
A. evaluate results.
B. set goals and objectives.
C. formulate strategies.
D. establish forecasting methods.
The most obvious evaluation involves checking whether the company has successfully
avoided any potential labor shortages or surpluses.

BT: Knowledge
Difficulty: Easy
5-49
66. (p. 209) The process of determining whether there are any subgroups (e.g., minorities or
disabled) whose proportion in a given job category within a company is substantially different
from their proportion in the relevant labor market is called:
A. adverse treatment analysis.
B. workforce utilization review.
C. subgroup reconciliation.
D. discrimination analysis.
Workforce Utilization Review is a comparison of the proportion of workers in protected
subgroups with the proportion that each subgroup represents in the relevant labor market.

BT: Knowledge
Difficulty: Medium
67. (p. 209) _____ forecast and monitor the proportion of various protected group members,
such as women and minorities, that are in various job categories and career tracks.
A. Ethnocracies
B. Group rights
C. Affirmative action plans
D. Employment background checks
Many firms adopt "voluntary affirmative action programs" to make sure underutilization does
not occur and to promote diversity.

BT: Knowledge
Difficulty: Medium
5-50
68. (p. 210) _____ requires that government contractors and subcontractors maintain affirmative
action programs.
A. Executive Order 11246
B. Title VII
C. Executive Order 11478
D. The Civil Rights Act of 1991
Companies might also engage in utilization reviews because they are legally required to do so.

BT: Knowledge
Difficulty: Medium
69. (p. 210) Recruitment activities are designed to affect all of the following except:
A. the number of people who apply for vacancies.
B. the type of people who apply for vacancies.
C. the likelihood that those applying for vacancies will accept positions if offered.
D. the evaluation of employees once hired.
The goal of an organizational recruitment program is to ensure that the organization has a
number of reasonably qualified applicants (who would find the job acceptable) to choose from
when a vacancy occurs.

BT: Comprehension
Difficulty: Medium
5-51
70. (p. 210-211) The goals of personnel recruitment include all but one of the following. Name the
exception.
A. To increase the number of people who apply for vacancies.
B. To control the type of people who apply for vacancies.
C. To finely discriminate among reasonably qualified applicants.
D. To inflate the number of applicants for statistical purposes.
Recruiting new personnel and selecting new personnel are both complex processes. Each task
is hard enough to accomplish successfully, even when one is well focused. Organizations
explicitly trying to do both at the same time will probably not do either well.

BT: Knowledge
Difficulty: Medium
71. (p. 211) Which of the following types of interviews has the highest validity in terms of
making effective screening decisions?
A. Focus groups
B. Highly structured interviews
C. Questionnaires
D. Highly unstructured interviews
Applicants respond less positively to highly structured interviews, and yet this is precisely the
type of interview that has the highest validity in terms of making effective screening
decisions.

BT: Knowledge
Difficulty: Medium
5-52
72. (p. 211) Which of the following tends to have the most positive influence on job choice
decisions?
A. The kind of recruiters used
B. The recruitment sources
C. The use of realistic job previews
D. Job vacancy characteristics
All companies have to make decisions in three areas of recruiting: (1) personnel policies,
which affect the kinds of jobs the company has to offer; (2) recruitment sources used to solicit
applicants, which affect the kinds of people who apply; and (3) the characteristics and
behaviors of the recruiter. These, in turn, influence both the nature of the vacancies and the
nature of the people applying for jobs in a way that shapes job choice decisions.

BT: Knowledge
Difficulty: Easy
73. (p. 212) An approach that pays higher than current market wages is called a:
A. premium-wage approach.
B. lead-indicator approach.
C. lead-the-market approach.
D. first-mover approach.
Because pay is an important job characteristic for almost all applicants, companies that take a
"lead-the-market" approach to paythat is, a policy of paying higher-thancurrent-market
wageshave a distinct advantage in recruiting. Pay can also make up for a job's less desirable
features.

BT: Knowledge
Difficulty: Medium
Topic: Extrinsic and Intrinsic Rewards
5-53
74. (p. 212) Organizational recruitment materials that emphasize due process, rights of appeal,
and grievance mechanisms send a message that:
A. the organization has many problems.
B. the organization values employee rights over productivity and profitability.
C. job security is high in the organization.
D. employee morale is low in the organization.
Due process policies formally lay out the steps an employee can take to appeal a termination
decision.

BT: Knowledge
Difficulty: Medium
75. (p. 212) Policies that state that either party in the employment relationship can terminate that
relationship at any time, regardless of cause are called:
A. due process policies.
B. employment-at-will policies.
C. employee liability policies.
D. freedom-to-work policies.
Research indicates that job applicants find companies with due process policies more
attractive than companies with employment-at-will policies.

BT: Knowledge
Difficulty: Medium
5-54
76. (p. 212) A policy that lays out the steps an employee can take to appeal a termination
decision is called a(n):
A. due process policy.
B. employment-at-will policy.
C. outsourcing policy.
D. affirmative action policy.
Research indicates that job applicants find companies with due process policies more
attractive than companies with employment-at-will policies.

BT: Knowledge
Difficulty: Medium
77. (p. 213) The U.S. Army's "Be all you can be" campaign is an example of:
A. general advertising.
B. reputation advertising.
C. image advertising.
D. proactive advertising.
Sometimes, however, organizations advertise just to promote themselves as a good place to
work in general. 63 Image advertising is particularly important for companies in highly
competitive labor markets that perceive themselves as having a bad image.

BT: Application
Difficulty: Medium
Topic: Image Advertising
5-55
78. (p. 214) The sources from which companies recruit potential employees are:
A. dictated largely by legal constraints.
B. determined by demographic patterns.
C. typically regulated by industry standards.
D. a critical aspect of its overall recruitment strategy.
The total labor market is expansive; any single organization needs to draw from only a
fraction of that total.

BT: Knowledge
Difficulty: Easy
Topic: Recruitment Sources
79. (p. 214) Which of the following is an advantage of relying on internal recruitment sources?
A. They are likely to increase diversity.
B. They minimize the impact of political considerations in the hiring decision.
C. They are generally cheaper and faster than other means.
D. They will increase innovation within an organization.
In general, relying on internal sources offers a company several advantages.

BT: Comprehension
Difficulty: Medium
Topic: Internal versus External Sources
5-56
80. (p. 216) Which of the following best exemplifies the process of self-selection?
A. An applicant posts his/her resume on an online job bulletin board.
B. While at a job fair, an applicant decides to interview with the ABC Company.
C. An applicant is asked to return for a second interview with the ABC Company.
D. An applicant takes an online "job fitness" test before deciding to apply to the ABC
Company.
Many direct applicants are to some extent already "sold" on the organization. Most of them
have done some homework and concluded that there is enough fit between themselves and the
vacancy to warrant their submitting an application. This process is called self-selection.

BT: Application
Difficulty: Medium
Topic: Direct Applicants and Referrals
81. (p. 216) Recruiting advertisements in newspapers and periodicals:

A. are exempt from the requirements of Title VII.
B. are most effective in attracting applicants who are currently employed.
C. are generally not needed.
D. typically generate less desirable recruits than direct applications or referrals.
Advertisements to recruit personnel are ubiquitous, even though they typically generate less
desirable recruits than direct applications or referralsand do so at greater expense.
However, because few employers can fill all their vacancies with direct applications and
referrals, some form of advertising is usually needed.

BT: Comprehension
Difficulty: Medium
Topic: Advertisements in Newspapers and Periodicals
5-57
82. (p. 217) The most effective source for recruiters is:
A. referrals.
B. job fairs.
C. the Web.
D. local newspapers.
A recent survey of HR executives indicated that electronic job boards were the most effective
source of recruits for 36 percent of the respondents, well ahead of local newspapers (21
percent), job fairs (4 percent), and walk-ins and referrals (1 percent).

BT: Comprehension
Difficulty: Medium
Topic: Electronic Recruiting
83. (p. 217, 220) Van Roehling Inc., located in a small town 40 miles from Detroit, is seeking to
hire 10 production workers. The company also wants very much to improve the diversity of
its presently all-white, male workforce. Which of the following combinations of recruitment
sources would be the best for the company to use?
A. Referrals from current employees and walk-in applicants.
B. A job search firm and an advertisement in the local newspaper.
C. Referrals from current employees and an advertisement in the local newspaper.
D. Advertisement in a metropolitan Detroit newspaper and Michigan's public employment
service.
Because there are few rules about the quality of a given source for a given vacancy, it is
generally a good idea for employers to monitor the quality of all their recruitment sources.

BT: Application
Difficulty: Medium
5-58
84. (p. 220) Executive search firms (ESFs):

A. serve as an important confidentiality buffer between the employer and the recruit.
B. work almost exclusively with high-level, unemployed executives.
C. typically require the person being placed to make the initial contact with the prospective
employer directly.
D. are not subject to the requirements of Title VII.
Dealing with executive search firms is sometimes a sensitive process because executives may
not want to advertise their availability for fear of their current employer's reaction. Thus,
ESFs serve as an important confidentiality buffer between the employer and the recruit.

BT: Comprehension
Difficulty: Medium
Topic: Public and Private Employment Agencies
85. (p. 221) Yield ratios express the:

A. output yielded by a new hire in relation to the cost of recruiting the new hire.
B. percentage of applicants who successfully move from one stage of the recruitment and
selection process to the next.
C. dollar costs per hire.
D. quality of new hires by comparing the cost of training the new recruits to the cost of hiring
them.
Because there are few rules about the quality of a given source for a given vacancy, it is
generally a good idea for employers to monitor the quality of all their recruitment sources.
One means of accomplishing this is to develop and compare yield ratios for each source.

BT: Knowledge
Difficulty: Medium
5-59
86. (p. 221) Cost per hire is:

A. useful in establishing the efficiency of a recruiting source.
B. lower for private employment agencies than for public employment agencies.
C. lower for executive recruits than for clerical recruits.
D. a measure of applicant quality.
Yield ratios and cost-per-hire data are useful in establishing the efficiency of a given source.

BT: Knowledge
Difficulty: Medium
87. (p. 221-222) The recruiting source that is likely to be least costly per recruit hired is:
A. a renowned university.
B. newspaper ads.
C. an employee referral.
The best two sources of recruits are local universities and employee referral programs.

BT: Knowledge
Difficulty: Medium
88. (p. 221-222) The recruiting source that is likely to have the highest yield ratio is:
A. a college/university.
B. walk-ins.
C. a public employment agency.
Executive search firms generate a small list of highly qualified, interested applicants, but this
is an expensive source compared with other alternatives.

BT: Knowledge
Difficulty: Medium
5-60
89. (p. 222) Which of the following recruiter characteristics do applicants tend to respond to
most positively?
A. Warmth
B. Race (same as applicant)
C. Age
D. Gender
Two traits stand out when applicants' reactions to recruiters are examined. The first, which
could be called "warmth," reflects the degree to which the recruiter seems to care about the
applicant and is enthusiastic about her potential to contribute to the company. The second
characteristic could be called "informativeness."

BT: Knowledge
Difficulty: Medium
Topic: Recruiters
90. (p. 223) All but one of the following would enhance recruiter effectiveness. Name the
exception.
A. Ensure recruiters provide applicants with timely feedback.
B. Conduct dual-purpose recruitment and selection interviews.
C. Ensure recruiters are knowledgeable about company policies and procedures and the
characteristics of the position.
D. Do recruiting in teams rather than individually.
Although research suggests that recruiters do not have much influence on job choice, this does
not mean recruiters cannot have an impact.

BT: Comprehension
Difficulty: Medium
Topic: Recruiters
Essay Questions
5-61
91. (p. 194-195) Until recently, Donnelly Inc. manufactured mirrors that were sold exclusively to
the "Big Three" automobile makers. In the past year, following the loss of the General Motors
account, the company landed substantial accounts (30 percent of current business) with
Toyota and Honda. These new clients need somewhat different products, which require a
more labor-intensive production process. Also, the new clients have leaner inventory systems
than the Big Three. Under these circumstances, what kind of method would be most
appropriate to use in forecasting the company's labor demand in the upcoming year: a
statistical approach or a judgmental approach? Explain your answer.
The facts presented indicate that historical trends between leading indicators and the labor
demand are changing. For example, the substantial new business is labor-intensive. Under
these circumstances, statistical approaches to forecasting labor demand are probably
inappropriate. A judgmental approach will be able to take into account the recent changes.

BT: Application
Difficulty: Hard
Topic: Forecasting
92. (p. 197) Describe what occurs at the goal setting and strategic planning step of the human
resource planning process.
In the goal-setting step of HRP, attention is focused on the desired end state, and benchmarks
(i.e., goals) are set to be used in determining the relative success of that program aimed at
redressing some pending labor shortage or surplus. Goals should come directly from the
analysis of the labor supply and demand, and should include a specific figure about what
should happen with the job category or skill area and a specific timetable for when results
should be achieved.
Once the goals are established, the firm needs to choose from the many different strategies
available for redressing labor shortages and surpluses. This stage is critical, since the options
available to the planner differ widely in their expense, speed, effectiveness, amount of human
suffering, and revocability.

BT: Analysis
Difficulty: Medium
5-62
93. (p. 198) Discuss the major options organizations have for reducing labor surpluses. In doing
so, discuss how they vary in terms of speed and the amount of human suffering.
Options that are fast but result in high human suffering include downsizing, pay reductions,
and demotions. Transfers and work-sharing reduce suffering somewhat. Slower approaches
include attrition, retirements, hiring freezes, and retraining. These tend to reduce human
suffering greatly.

BT: Analysis
Difficulty: Hard
94. (p. 198) Forecasting indicates the need for skilled technical employees in your company will
increase dramatically this year. If the company continues on its present course, it will
experience a substantial labor shortage by year's end. Something must be done fast, but
management is concerned about maintaining its flexibility. Which of the options for avoiding
expected labor shortages identified in the text would be most appropriate under these
circumstances? Explain your answer.
The company has two criteria for selecting an option to meet an anticipated labor shortage: it
must be "fast," and it must be "flexible" (i.e., revocable). The only three options discussed in
the text that meet these criteria are overtime, temporary employees, and outsourcing. The
ideal answer will note that the need for skilled labor is expected to "increase dramatically,"
which suggests that overtime alone may not be sufficient.

BT: Application
Difficulty: Hard
5-63
95. (p. 198-199, 201) What is downsizing? Discuss the four major reasons why organizations
engage in downsizing. In general, are downsizing strategies successful? List reasons why or
why not.
Downsizing is the planned elimination of large numbers of personnel designed to enhance
organizational effectiveness.
Companies engage in downsizing for the following major reasons: First, many organizations
are looking to reduce costs, and because labor costs represent a big part of a company's total
costs, this is an attractive place to start. Second, companies may close outdated plants or
introduce technological changes to old plants, which reduces the need for labor. Third,
because of economic reasons, companies change the location of where they do business.
There seem to be a number of reasons for the failure of most downsizing efforts to live up to
expectations in terms of enhancing firm performance including:
Although the initial cost savings are a short-term plus, the long-term effects of an improperly
managed downsizing effort can be negative.
Many downsizing campaigns let go of people who turn out to be irreplaceable assets.
Employees who survive the staff purges often become narrow-minded, self-absorbed, and
risk-averse.

BT: Analysis
Difficulty: Medium
Topic: Downsizing
5-64
96. (p. 204-205) Discuss the advantages and disadvantages of using temporary employees as an
option in response to labor shortages.
Advantages of using temporary workers include:
They increase flexibility needed to operate efficiently in the face of swings in the demand for
goods and services.
Frees firm from administrative burden of being "employer of record."
Small companies that cannot afford their own testing programs often get employees who have
been tested by a temporary agency.
Many temp agencies test and train employees prior to employment.
"Temps" often bring a different perspective to an organization.
Usually, they are less expensive than regular, full-time employees.
Disadvantages of temporary workers include:
"Temps" lack organizational experience that may create conflict with full-time employees.
Feelings of a two-tiered society may develop.

BT: Analysis
Difficulty: Medium
5-65
97. (p. 205-208) Describe outsourcing and offshoring and provide examples. Why are they used?
What are some of the problems with these efforts? When is it a good idea to use outsourcing
or offshoring?
Outsourcing is an organization's use of an outside organization for a broad set of services. An
example is that a company might outsource custodial jobs to a cleaning service. Offshoring is
a special case of outsourcing where the jobs that move actually leave one country and go to
another. An example is today's trend of offshoring telecommunications to India.
Outsourcing is used because it is cheaper for the company than to perform the functions inhouse. Offshoring has become popular because of lower wage rates in developing countries.
Quality control problems, security violations, and poor customer service experience have in
many cases wiped out all the cost savings attributed to lower wages and more.
When choosing an outsourcing vendor, it is usually the bigger and older the better.
Jobs that are proprietary or require tight security should not be outsourced. In addition, it is a
good idea to start small and monitor constantly.
In general, the work that is outsourced needs to be "modular" in the sense that the work is
self-contained and does not require the outsourcing firm to provide any information that is
best kept secret for competitive reasons.

BT: Analysis
Difficulty: Medium
5-66
98. (p. 211, 214-215) Discuss the relative merit of internal versus external recruiting.
Internal recruiting
Advantages:
Provides an opportunity for employee advancement within the company.
Generates a sample of applicants who are well known to the company.
Applicants are relatively knowledgeable about the company's vacancy, which minimizes the
problem of inflated expectations.
It is generally cheaper and faster to fill vacancies internally.
External recruiting
Advantages:
For entry-level positions and some specialized upper-level positions, there may not be any
internal recruits available.
Bringing in outsiders may expose the organization to new ideas.
It is a good way to strengthen one's own company and weaken one's competitors at the same
time.

BT: Analysis
Difficulty: Medium
Topic: Personnel Policies, Recruitment Sources
5-67
99. (p. 216, 220) In the next six months, your company needs to hire 35 external new hires for
production assembly and machine shop positions. In the past, your company has had difficulty
in meeting its affirmative action goals in terms of percentage of minorities among new hires.
For each of the following recruitment sources, state whether you would use the source in your
recruitment program and explain why or why not: (1) referrals from current employees, (2)
public employment agencies, and (3) executive search firms.
Referrals from employeesA decision to use a referral can be supported by advantages of
referrals (lower turnover, etc.) provided that:
The student recognizes that referrals tend to be relatively homogenous, and that if the
company is underutilizing minority workers, using referrals from current employees may only
exacerbate the problem.
The student also uses the public employment agency to address underutilization concerns.
A decision not to use referrals can be supported by concerns regarding homogeneity of
referrals (mentioned above).
Public employment agenciesA decision to use public employment agencies can be
supported because specialized "desks" for minorities make them an excellent source for
employers who feel that they are underutilizing minority groups. A decision not to use them
can be supported by concern some employers have regarding the motivation and quality of
workers referred by public employment agencies.
Executive search firmsA decision not to use such firms is supported by the fact that they
may not have a viable business model, given the recent changes in the economy and in
technology.

BT: Application
Difficulty: Hard
Topic: Direct Applicants and Referrals; Public and Private Employment Agencies
5-68
100. (p. 221-222) Compare and contrast the following recruiting sourcesexecutive search firms,
employee referrals, newspaper advertising, and colleges/universitiesin terms of efficiency
(cost per hire) and quality (yield ratio).
Employee referrals and executive search firms generally have higher yields than the other
sources. The latter (search firms) cost more per hire largely due to the higher-quality
applicants at executive levels. Employee referrals combine for low-cost/high-quality hires, but
have a disadvantage of offering a less diverse pool.

BT: Analysis
Difficulty: Hard
5-69

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Chapter 05 - Human Resource Planning and Recruitment

1. The first step in the human resource planning process is forecasting.

Chapter 05 - Human Resource Planning and Recruitment

Chapter 05 - Human Resource Planning and Recruitment

16. The goal of recruiting is simply to generate large numbers of applicants.

Chapter 05 - Human Resource Planning and Recruitment

Multiple Choice Questions

Chapter 05 - Human Resource Planning and Recruitment

28. An advantage of statistical forecasting methods is that:

29. Identify the correct statement about forecasting.

31. A "leading indicator" is:

Chapter 05 - Human Resource Planning and Recruitment

32. Identify the incorrect statement about statistical planning models.

Refer to the following transitional matrix.

34. Which job category appears to be the most diversely staffed?

Chapter 05 - Human Resource Planning and Recruitment

36. In which job category or categories were there demotions?

37. In which job category is there the greatest degree of stability?

Chapter 05 - Human Resource Planning and Recruitment

40. The purpose of setting specific quantitative goals is:

Chapter 05 - Human Resource Planning and Recruitment

Chapter 05 - Human Resource Planning and Recruitment

51. The key to a successful downsizing effort is to:

52. Which of the following statements about older workers is false?

Chapter 05 - Human Resource Planning and Recruitment

56. Identify the incorrect statement about temporary workers.

Chapter 05 - Human Resource Planning and Recruitment

60. Identify the correct statement about offshoring.

61. When a company faces a shortage of labor:

Chapter 05 - Human Resource Planning and Recruitment

62. Identify the correct statement about furloughs.

65. The final step in the planning process is to:

Chapter 05 - Human Resource Planning and Recruitment

Chapter 05 - Human Resource Planning and Recruitment

Chapter 05 - Human Resource Planning and Recruitment

79. Which of the following is an advantage of relying on internal recruitment sources?

80. Which of the following best exemplifies the process of self-selection?

Chapter 05 - Human Resource Planning and Recruitment

81. Recruiting advertisements in newspapers and periodicals:

82. The most effective source for recruiters is:

84. Executive search firms (ESFs):

Chapter 05 - Human Resource Planning and Recruitment

85. Yield ratios express the:

86. Cost per hire is:

Chapter 05 - Human Resource Planning and Recruitment

Chapter 05 - Human Resource Planning and Recruitment

Chapter 05 - Human Resource Planning and Recruitment

98. Discuss the relative merit of internal versus external recruiting.

Chapter 05 - Human Resource Planning and Recruitment

Chapter 05 - Human Resource Planning and Recruitment

Chapter 05 Human Resource Planning and Recruitment Answer Key

True / False Questions

AACSB: Business Knowledge and Analytic Skills

Chapter 05 - Human Resource Planning and Recruitment

AACSB: Reflective Thinking Skills

AACSB: Reflective Thinking Skills

AACSB: Reflective Thinking Skills

AACSB: Reflective Thinking Skills

Chapter 05 - Human Resource Planning and Recruitment

AACSB: Reflective Thinking Skills

AACSB: Reflective Thinking Skills

AACSB: Reflective Thinking Skills