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I've heard stories of how people looking for jobs have been turned down by companies because they are over-qualified, even when they are willing to take a (sometime substantial) pay-cut.

Why do companies not want to hire people who are over-qualified for the job? Wouldn't it make sense for a company to hire someone especially when they are over-qualified for the job (i.e. PhD for a high-school teaching job) if the person in question is willing to take a paycut/accept what the company is offering for the job?

Why do I keep hearing stories of people being rejected for jobs due to being over-qualified?

Is the phrase over-qualified simply a go-to term that companies/recruiters use to reject an applicant?

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Is a PhD qualified to teach high school? In general, no. A PhD program prepares someone for a career of independent research which is orthogonal to the skills a high school teacher will need. You might want to read up on menarchy, your state's mandatory reporting requirements, and a whole bunch of other stuff that did not make it into your literature review. –  emory Jul 16 at 0:04
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@emory If said PhD wasn't qualified to teach high school then they certainly wouldn't be *over*qualified, and wouldn't be relevant to this question. –  Jason C Jul 16 at 3:47
    
@emory "menarchy" are you sure that's the word you meant? Is that something high-school teachers are taught about? –  Lego Stormtroopr Jul 22 at 1:34

4 Answers 4

up vote 123 down vote accepted

Generally speaking, the overqualified employee is fundamentally less likely to be happy with their position. As a consequence:

  • They will likely leave at the first opportunity.
  • Generally speaking, if they take the job it's because they couldn't find anything better. This can lead to a certain resentment of their situation. From the company's point of view, the best employees are the ones that feel grateful for the opportunity to work there.
  • They will be more likely to get bored with the work.
  • They are more likely to challenge authority.
  • At some point they may change their mind about taking the pay-cut and start asking for more money.
  • Some companies are suspicious of your motivations when you're aiming for a lower position. Why are you applying for this job? Are you trying to learn about the company and possibly steal trade secrets?
  • (As mentioned by Ben Crowell and Vietnhi Phuvan) Many managers will feel intimidated/threatened by someone who is possibly more qualified than themselves, and will be reluctant to hire someone who might be able to take their job.

Keep in mind that hiring is a very costly and risky process for a company, especially if the new employee leaves or has to be fired, thereby starting the process all over. Costs include time spent searching through CVs, interviewing, background checks, recruitment agency fees, potential legal fees if the company has to apply for licenses or visas for the employee, overhead costs of initiating benefits, training fees, expenses for new equipment and software licenses, and possibly redundancy fees if they have to fire the employee.

That's not including the costs of potential damage to the actual work process, e.g. disruption to the projects that can occur when the new hire leaves, the opportunity cost of an unhappy employee not working very efficiently, and in the case of management positions, the damage that can arise from misleading the team and/or leaving them hanging.

So when presented with an employee that looks like a "flight risk", the company naturally starts to question whether or not it's worth the risk of them possibly leaving.

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I do not think it is so much that most are only willing temporarily, but that if next week or next month someone else offers them a job for twice their current salary, and that just overall better utilises their skills, everyone would take that offer. –  Jonathon Wisnoski Jul 14 at 18:04
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I think your list is missing an important item: managers may feel threatened by people who have fancier qualifications than they do, or who may be smarter than they are. –  Ben Crowell Jul 15 at 3:12
    
In case of contract jobs (company hires a person from another company on contract), I feel the company loves to hire overqualified people. They will surely get the work done and the company doesn't have to worry for the above mentioned reasons of challenging authority, pay cuts, getting bored etc. (as the person won't be a direct employee). –  Crusaderpyro Jul 15 at 4:19
    
@BenCrowell Good point, I'll add it to the answer. –  CaptainCodeman Jul 15 at 7:24
    
@Crusaderpyro However in these instances the contractor typically gets paid a very high wage as well. –  CaptainCodeman Jul 15 at 7:26

Having talked to a few Google employees, I can say that Google likes to hire on an overqualified basis. But that's because they see themselves as a growing company, and they like their employees to go at least one level up, before they reach their level of incompetence, as described by the Peter principle.

Most prospective employers' management are leery and probably insecure about offering positions to overqualified people.

  1. One concern is that the overqualified individual may be taken the position to satisfy a short-term need for cash, and will bail out as soon as an opportunity that's more suitable to their quals pops up. Hiring people was fun the first time I did it but it did not take long for the fun to wear off and for me, to see hiring as a chore. Hiring people who will bail out in short order - that's not my idea of a good time to be had by all concerned.

  2. Another concern may be intensified future salary/promotion demands from the overqualified individual.

  3. A third concern may be the morale of the individual involved, who is taking a step down and comparing the other team members/management unfavorably to themselves.

  4. A fourth concern is, why should a boss hire someone who could take their job?

Having said that, the list of possible concerns is by no means complete.

On a personal note, I've lost a bunch of interviews over the decades when as a result of my-take-no-prisoners attitude toward interviewing, I inadvertently crossed the line from convincing the boss that I could do the job to convincing the boss that I could take THEIR job.

That bosses don't like to hire overqualified people is only part of the story. I don't think that bosses like to hire people who are smarter than themselves or who can prove to be better managers than themselves either. I think the safest way is to gun for the position and not try to imply anything else.

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#4 is where I am now. My boss sees me as a threat, which has needless to say created a certain amount of tension within the office. It's obvious this affects both my moral (expecting my boss to find some way to justify firing me to his boss) and my boss's moral (expecting I'll get him fired by out performing him at his responsibilities), but by extension our entire team's moral is affected. I push to improve practices and policies to benefit the efficiency of our department, my boss undermines these efforts, and our entire team suffers. (and no point going over his head, CEO is his friend) –  RualStorge Jul 14 at 14:41
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Responding to the last paragraph: Paul English (paulenglish.com) goes out of his way to hire people who are smarter than he is - and he's pretty smart, with a track record to prove it. Work for him if you can. I was lucky to have had Paul as a student many years ago. –  Ethan Bolker Jul 14 at 16:22
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@EthanBolker Work with smart people and you end up smarter than you were before. Work with idiots and sooner or later, you end up as one of them. You are the company you keep, and you are who you work with. So be be careful what company you keep, and be cognizant as to who you work with :) –  Vietnhi Phuvan Jul 14 at 16:41
    
Google may not be the typical workplace, because they are still growing and their niche is still pioneer work requiring talented researchers to figure out how to do t hings. –  Thorbjørn Ravn Andersen Jul 15 at 21:57
    
@ThorbjornRavnandersen It's not the typical workplace - that's why I want to join it. –  Vietnhi Phuvan Jul 15 at 22:16

Is the phrase over-qualified simply a go-to term that companies/recruiters use to reject an applicant?

No.

"Over-qualified" means that the experienced, perhaps well-paid, applicant is not a good fit for the specific position which happens to require less experience and offering less pay.

As a hiring manager, I want the position and applicant to be a great fit for each other.

In general, I want to hire someone who can grow in the position, who can be happy and enjoy themselves while contributing to the team, and who will likely be here for the long-haul. Usually that means someone who matches the position technically, and experience-wise, or can grow into that match quickly.

I have hired folks who had more experience than the position required (and were "over-qualified" in at least some aspects). In each case, they were looking to make a change in their career path for a good reason. While interviewing, I made sure they weren't just looking to "take it easy" or weren't just "willing to accept less" for a short period of time.

It's possible to get hired when over-qualified. It's just important to convince the hiring manager that you won't be bored, won't start to feel underpaid, and will eagerly accept your new (lesser) position.

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in that case of course they were not necessarily overqualified for the position they were applying for. Say a programmer with 15 years experience applying for a junior DBA position because he has little experience in that field and wants a career change would not be overqualified (though there might still be questions about the reasons for the career change to a lower paying position). –  jwenting Jul 14 at 13:50
    
hmm, that's pretty much what I describe. I've myself chosen to not seek advancement for similar reasons, mostly to reduce stress levels (with my expertise level I should have a project management/ team lead position, something I explicitly don't want). –  jwenting Jul 14 at 13:59
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High-level people stepping down for personal reasons is the classic example, I think. In some sense they literally are looking to "take it easy", in the sense that although they're professionally qualified for a big job, their circumstances mean they want to work part-time, or get home before midnight, or not travel at weekends, or whatever it is that rules out the role they'd be precisely qualified for in that organisation. Like Joe says, they need to prove they're enthusiastic about what they are offering to do. –  Steve Jessop Jul 14 at 15:08

There are cases where overqualified candidates get hired, and not just because of a "lucky whim", like during the dot com bust, a guy who was making $120K at a new tech company accepted a $40K position making web pages to make ends meet. In some markets and situations, you can justify such drastic differences in salaries and responsibilities. There are project managers who want to be more hands on, so they go back to development. Otherwise, if you want someone who can do multiple things, then "overqualified" can be just what you want. Like an person who can do SQL, DBA work, and also has a good grasp on requirements.

Also, being overqualified doesn't necessarily mean you'll produce that much better results. If a position seeks an "entry level" or "mid-level" person, you're putting extra and different talents to waste by getting a sr. person to do that job, not to mention overpaying for it too.

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