Big data tells J&J that recent grads are more loyal than experienced hires

Drugmakers are increasingly using big data analysis to reap better insights into drug development. But the "people analytics team" at drugmaker Johnson & Johnson ($JNJ) turned the technique on employees to figure out whether hiring people with experience pays off better than picking up kids right out of college. The result is good news for all of those MBA still beating the bushes for a job.

Hiring of recent grads was boosted 20% last year after the analysis found that recent grads handled their duties nearly as well as the old pros while staying onboard at J&J significantly longer, The Wall Street Journal reports. We "dispelled a myth in our organization," explained Doug Grant, who leads the people analytics team.

Grant decided to undertake the deep data dive after HR folks at the company noted a 10% drop in new grad hiring at the company for the 2012-2013 school year. It turned out that recruiters had convinced the company that bringing in more experienced folks would pay better dividends over the long haul. Managers were told to lean more heavily on hiring experienced applicants for hires in departments like human resources, information technology and supply-chain management, Mary Lauria, J&J's vice president of global talent management, tells the newspaper.

But the human resources managers weren't sure about all of that, and they had Grant's new team to turn to for the kind of data manipulation that many large companies like Wal-Mart ($WMT) and Xerox ($XRX) now use to help them craft better management decisions rather than having to rely on guesswork and hunches. His team went to work on data points on about 47,000 employees. When the findings were presented to decision makers, they reversed the trend and gave recent grads a closer look.

The fact that recent grads at J&J are staying longer than the more experienced hires also flies in the face of the accepted belief that younger people are less loyal and much more likely to job hop than earlier generations. The finding at J&J may have to do with the company itself. J&J thinks it is related to the company's two-year leadership program which allows newbies to make social ties with peers while also picking up mentors from across the company.

San Francisco State University's John Sullivan

John Sullivan, a management professor at San Francisco State University who previously advised J&J, says the new hires are more easily molded to the company culture while other "outsiders" may find it hard to fit in.

The findings are less exciting for people looking to move into J&J from other companies, and according to some studies, that might be quite a lot. Last year, Randstad's Pharma Engagement Study found that 51% of pharma and biotech employees wanted to move to another company, and 66% were likely to make the move given the opportunity. Turns out that inadequate pay and lack of opportunity for advancement, along with high stress levels and difficult relationships with managers and coworkers, were making them antsy to leave.

- read the WSJ story (sub. req.)

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