The impact of benefits on graduating student willingness to accept job offers.

The research presented in this article evaluates the influence of quality of information communicated about both non-traditional and traditional benefits on the recruitment of college graduates. Using a sample of students who were about to engage in the job search process, we varied the quality of information describing benefits and examined how communicating different degrees of information influenced willingness to accept a job. Increasing the quality of information communicated about traditional decreased the willingness to accept job offers. However, increasing the quality of communication about non-traditional benefits increased respondents' perceived value of those benefits in making job choices. The results partially support the metamyth of communication.

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The ability to recruit the best applicants helps firms develop a superior labor pool that can provide a competitive edge (Capelli, 2000) and have a direct affect on firm financial performance (Huselid, 1995). Effective communication with job applicants appears to be a powerful tool in the recruitment process (Ralston & Brady, 1994). If recruitment is viewed as the process of marketing a place of employment to a desired job applicant (Maurer, Howe, & Lee, 1992), communication of information regarding the work context is essential in securing desirable applicants. Numerous studies have assessed the impact of communication on the recruiting process. Communicating positive information about the work context (Saks & Wiesner, 1994) and the firm's social reputation appears to influence the willingness of applicants to accept job offers (Cable & Grahm, 2000). Communicating information about affirmative action programs seems to influence the willingness of minorities to accept job offers (Highouse, Stierwalt, Bchiochi, Elder, & Fisher, 1999). Having prompt communications with job applicants has been demonstrated to affect to the willingness of applicants to accept job offers (Rynes, Bretz, & Gerhart, 1991).

While these studies suggest that communications about contextual attributes significantly affect applicants' willingness to pursue a job opportunity, other research indicates that the communication of information regarding benefits is likely to influence applicants' willingness to accept job offers (Nagel & Bohovich, 2000; Smither, Millsap, Stoffey, Reilly, & Pearlman, 1996). Thus, effective communication about benefits may also contribute to successful recruitment of applicants.

It appears that communication to job applicants about compensation practices and benefits in particular is often inadequate. Research suggests that applicants are often confused or have incomplete information regarding compensation and benefits. One study reported in American Demographics (1987) suggested that employees are largely ignorant about the nature of the benefits provided by employers. Furthermore, the study noted that even though employees list benefits as an important reason for working with a particular organization, many cannot name all of their benefits, let alone completely understand them. This parallels research that graduating college students have meager knowledge of common starting salaries (Betts, 1996). Research on benefits communication that provides detailed information about different types of benefits is limited. Only one previous study addressed the need of tailoring methods of communication about benefits to more effectively recruit desired employees (Hettenhouse, Lewellen, Lanswer, & James, 1975). Previous research has also failed to examine how communication about different types of benefits influences the willingness of applicants to accept job offers.

This article specifically addresses benefits communication associated with influencing employee recruitment (Haar & Kossek, 1990). To address how the quality of benefits communication affects recruitment of new college graduates, we explore the role of benefits communication about both traditional and non-traditional benefits in attracting new entry-level recruits to the organization. We address how the quality of communication about traditional and non-traditional benefits influences the willingness to accept job offers by soon to be graduating college students. The paper also examines the influence of traditional and non-traditional benefits on applicants' willingness to accept job offers.

Review of the Research Literature

In the next section we explore issues associated with recruitment and communication about employment benefits. Specially, we address communication and recruitment, benefits and communication, and traditional and non-traditional benefits. Included in the discussion are several hypotheses and one research question examined by the study.

Communication and Recruitment

Recruitment is commonly viewed as an element in the socialization process prior to organizational entry. During this stage, employers attempt to attract the type of employee who is most likely to be successful in the organization. This is done, in part, because selection is a two way decision-making process (Rynes, Bretz & Gerhart. 1991). That is, employers need valid and reliable information to select job applicants. Job applicants need valid and reliable information to assess the degree that the work context matches their work preferences. In both cases, there is a need for effective communications to ensure that both the employer and the employee get the information they need to reduce the uncertainties and ambiguities associated with starting a new job (Holder, 1993).

The dominant line of communication research about recruitment has addressed the realistic job preview (see Premack & Wanous, 1985). The realistic job preview emphasizes the need to communicate with prospective employees about the commonly shared positive and negative aspects of a given job situation. Typically, this information focuses on job duties which are one important element influencing applicants' willingness to accept job offers. However, Saks and Ashforth (1994) suggest that the realistic job preview, compared to the traditional job preview that emphasizes positive information only, diminishes applicants' willingness to accept a job offer but it increases the retention of employees.

Benefits and Communication

Benefits are often directed toward the male with a non-working wife and children (Baker, 1991). Thus, traditional benefits address family income security for a single wage earner family, and include benefits such as disability insurance, health insurance, retirement funding, and life insurance. However, employers are increasingly adopting non-traditional benefits, such as flexible work arrangements, telecommuting, portable retirement plans, and corporate sponsored day-care centers (Elswick, 2000). While non-traditional benefits are more likely to be offered by large organizations, such benefits are also found in smaller firms. For example, flexible work arrangements are relatively common in small businesses, and a significant number of small businesses also offer day care (Henneman & Berkely, 1999).

Some firms realize benefits are an effective tool to increase the willingness of candidates to accept job offers (Wojcik, 1998). However, to use this approach successfully, it is necessary to have a system to communicate information about the benefits to job applicants. Without successful efforts to communicate these benefits, it is unlikely that offering such benefits will have the desired impact on organizational recruitment efforts. Over the last four decades, research suggested that benefits communication is often deficient. Sloane and Hodges (1968) suggested that employees lacked adequate knowledge of benefits offered by their employer. These researchers conducted a survey on 174 white-collar workers in a large organization that invested $300 million each year in benefits. The researchers characterized employees' knowledge of benefits as "less than brilliant." Another research project that studied two medium-sized plants of two international companies showed respondents were not aware of all of the benefits offered to them; nor did they understand the value of the benefits that were provided (Holley & Ingrain, 1973). It would appear that not only are employees unaware of the benefits being provided to them; they do not have full knowledge of the financial value of the benefits offered.

Hettenhouse, Lewellen, Lanswer, and James (1975) administered a survey to 300 individuals in management to measure perception of actual dollar replacement costs for common benefits offered. The researchers reported that approximately one-third of the respondents believed the cost of providing their own pension plan was lower than it actually was. About one-half of those surveyed placed a lower than actual value on deferred pay, profit-sharing, extra vacation time, and stock options, while four out of five misperceived the worth of company-provided life insurance. Another study ten years later reported similar results with university employees (Wilson, Northcraft, & Neale, 1985). This lack of awareness and the employee or potential employees' failure to fully appreciate their employee benefits may lead to increased spending on employee benefits without deriving any of the anticipated positive outcomes. Collectively, these research studies imply that the nature and types of benefits may not be adequately communicated to employees either before or after organizational entry.