EMPLOYMENT PSYCHOLOGY
quently results in spoilage, breakage, or loss of materials,
and poor quality of output leading to dissatisfied customers
or damage claims; with inexperienced salesmen there is frequently
 loss of sales and alienation of former customers.
Wages of inefficient employees. This item covers only the
sums paid to employees hired under the less rigorous selection
 methods, who would be rejected if measurement methods
 were used and who would, in any event, eventually be
discharged or leave of their own accord.
Differences in production. If the new method enables the
firm to select a larger proportion of the more efficient and
able workers, it is logical to expect an increase in average
production per man. This can sometimes be estimated fairly
well.
Savings inferred from decreased labor turnover. Some investigators
 have aimed at a short-cut to a convincing estimate
 of the savings effected by the adoption of improved
employment procedures. Their plan is to secure a general
estimate of the cost of labor turnover, and then to make
their computation simply by comparison of the turnover
before and after the change in employment methods. The
utmost caution is needed when such a comparison is made,
because the rate of turnover is bound to be influenced by
many factors in addition to the effectiveness of the selection
process. Changes in general business conditions and in the
local labor market must be reckoned with, as well as changes
in supervision and the efficiency of management within the
plant. In view of these complications which enter into any
rigorous analysis of labor turnover, it is not advisable to rely
merely on estimates of savings based on a favorable change
in the turnover rate. Instead, the more detailed estimates
mentioned above are essential.
Values too intangible to be measured. One real but less
tangible advantage of improved selection methods is an increase
 in prestige through the fact that the company is

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