Too much education is bad for corporations for a multitude of reasons, but having access to an educated workforce is always good just in case the need arises. Department managers and human resource officials know that hiring people with too much education sometimes leads to more disadvantages than benefits for an employer. Moreover, since businesses are usually in existence for the primary purpose of making employees and employers money, obstacles to that purpose including too much education are to be avoided.
Overqualified employees get bored, unhappy, annoyed and can disrupt workplace equilibrium with subversive manipulation, underhanded deeds and misplaced professional ambition to the detriment of peers. Such individuals are better off not hired by some employers because they are simply not worth the effort, trouble, and time. This is not to say less educated employees are not capable of the same things. Rather, according to the Harvard Business Review, there is an increased possibility that employee curation decisions will turn bad if more overqualified employees are hired.
According to Patricia Schaefer of Business Know How, the Family and Work Institute cites lower education as the dominant factor in lower employee earnings. What if those employees can also do the same job for less though? In some cases including outsourcing, if less educated people can do the same job for a net gain, it is more cost effective to hire them. For example, hiring a 30K per year employee with a Bachelor of Arts with a net profit margin of 21 percent is better than keeping 45K per year employee with a Master of Science. This is especially the case if revenue rises less than the amount needed to offset the higher costs of hiring a more educated employee.
Employees with a lot of education, or higher earnings expectations are less likely to want to stick around a business. The Center for American Progress states employee turnover costs companies because they have to pay for things such as lost productivity in between hires, training expenses for new hires and recruitment costs. If an educated new hire is obviously seeking upward mobility and there is no room in an organization to accommodate that, then hiring a potentially less ambitious or less educated employee is sometimes the solution.
Educated people know a lot and that is a potential threat to co-workers and managers. In a report published by the Inter American Development Bank, it was found that younger employees - some of whom are more educated than those making hiring decisions – are discriminated against in order to preserve the job security of older employees. New hires that have too good a grasp on what is going on, and that are able to out-think both their superiors and colleagues are a job security hazard and put the beloved status quo at risk by rocking the corporate boat.
The possibility of insubordination is also a potential consequence of hiring an employee with more education than is necessary to work a job. Employees that are overqualified are more likely to become frustrated or disgusted by their work situation thereby raising the probability of an insubordinate act. In "Taming the Difficult Employee", Nancy Aldrich states insubordination arises from "lack of control" and "rewarding negative behavior". Using similar reasoning, being rewarded for getting an education is a negative reward when that reward is a job that is too restrictive and takes away from an employee's sense of control.