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Why External Hires Get Paid More, and Perform Worse, than Internal Staff

Here is some research sure to rankle every employee who has applied for an internal promotion and been passed over in favor of someone brought in from the outside.

According to Wharton management professor Matthew Bidwell, "external hires" get significantly lower performance evaluations for their first two years on the job than do internal workers who are promoted into similar jobs. They also have higher exit rates, and they are paid "substantially more." About 18% to 20% more. On the plus side for these external hires, if they stay beyond two years, they get promoted faster than do those who are promoted internally.

Full Story: http://knowledge.wharton.upenn.edu/article.cfm?articleid=2961

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