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LSU Researchers Find Link Between Personality and Credit Scores

Study also finds no link between poor credit and employee theft

Black Friday - the day after Thanksgiving - is the biggest shopping day of the year. Businesses fan the flames of consumerism weeks in advance, teasing potential customers with exceptional deals and rock-bottom prices. In this flurry of excitement preceding the holiday shopping season, it's easy for people to get swept away with offers of easy credit or get so wrapped up in spending that they whip out their credit cards without really thinking about the consequences it might have on their credit, and what impact poor credit can have on life.

According to a 2010 poll by the Society for Human Resource Management, 60 percent of surveyed employers conducted credit checks for some or all candidates as part of the hiring process. With unemployment rates in the United States at double digits, losing a career opportunity has a potentially higher impact than nearly ever before, while the nationwide wave of foreclosures simultaneously makes it more likely for an individual to have a black mark on their record. In an upcoming study to be published in the Journal of Applied Psychology, researchers from LSU, Texas Tech University and Northern Illinois University have showcased the link between credit ratings and an individual’s personality, and shown no connection between poor credit scores and theft.

First, the authors found a link between credit scores and personality types.

“With regards to personality and credit – it makes sense that conscientiousness is related to good credit, but what was really interesting was that agreeableness was negatively related to your credit score,” said Jeremy Bernerth, assistant professor in LSU’s E. J. Ourso College of Business Rucks Department of Management. “That suggests easy-going individuals actually have worse credit scores than disagreeable and rude individuals.  This suggests that agreeable individuals might get themselves in trouble by co-signing loans for friends or family or taking out additional credit cards at the suggestion of store clerks.”

However, contrary to what many employers consider common knowledge and practice, the researchers found no correlation between poor credit scores and bad behavior on the job.

“It was telling that poor credit scores were not correlated to theft and other deviant types of work behaviors,” said Bernerth. “Most companies attempt to justify the use of credit scores because they think such employees will end up stealing, but our research suggests that might not be the case.”

Authors included Bernerth; LSU Assistant Professor in the E. J. Ourso College of Business Daniel Whitman; Shannon Taylor of Northern Illinois University; and H. Jack Walker of Texas Tech University.

For more information, contact either Ashley Berthelot at 225-578-3870 or aberth4@lsu.edu, or Jeremy Bernerth at jeremyb@lsu.edu or 225-578-6154.

The Rucks Department of Management at LSU’s E. J. Ourso College of Business endeavors to prepare students for careers in fields such as international management, human resources, entrepreneurship and industrial/labor relations. A generous donation by LSU alumnus William W. Rucks and his wife, Catherine, has aided the department in securing faculty who are repeatedly recognized for their research and has aided student-affiliated organizations in achieving top honors nationally. For more information, visit www.bus.lsu.edu/management or call 225-578-6101.