The Basics of Industrial-Organizational Psychology

Businesses are always looking for ways to increase productivity, boost efficiency, and improve employee satisfaction, and that's where industrial-organizational (I-O) psychologists come in.

Industrial-organizational psychology is a branch that applies psychological theories and principles to organizations. Often referred to as I-O psychology, this combination of industrial psychology and organizational psychology focuses on understanding workplace productivity factors and issues related to employees' physical and mental well-being.

Industrial-organizational psychologists do many things, including studying worker attitudes and behavior, evaluating companies, and conducting leadership training. They help ensure that organizations hire the right talent, keep employees motivated, provide a fair workplace, and design effective workspaces.

What Is Industrial-Organizational Psychology?

You can think of industrial-organizational psychology as having two major sides: industrial or organizational psychology.

Industrial Psychology

The main role of the industrial side of industrial-organizational psychology is to learn how to best match individuals to specific job roles. This segment of I-O psychology is also sometimes referred to as personnel psychology.

In the field, these psychologists often assess employee characteristics to match individuals to jobs where they can truly shine. Key areas of focus in the industrial aspect of I-O psychology involve training employees, establishing job performance standards, and assessing job performance.

Organizational Psychology

The organizational side of I-O psychology is more focused on understanding how organizations affect individual behavior. Organizational structures, social norms, management styles, and role expectations are all factors that can influence how people behave within an organization.

By understanding such factors, I-O psychologists hope to improve individual performance and health while at the same time benefiting the organization as a whole.

Key Subject Areas in I-O Psychology

Industrial-organizational psychologists typically work in six key subject areas:

• Employee selection: This area involves developing employee selection assessments, such as screening tests, to determine if job applicants are qualified for a particular position.
• Ergonomics: The field of ergonomics involves designing procedures and equipment designed to maximize performance and minimize injury.
• Organizational development: I-O psychologists who work in this area help improve organizations, often through increasing profits, redesigning products, and improving the organizational structure.
• Performance management: I-O psychologists who work in this area develop assessments and techniques to determine if employees are doing their jobs well.
• Training and development: Professionals in this area often determine what type of skills are necessary to perform specific jobs, as well as develop and evaluate employee training programs.
• Work-life: This area focuses on improving employee satisfaction and maximizing the productivity of the workforce. I-O psychologists in this area might work to find ways to make jobs more rewarding or design programs that improve the quality of life in the workplace.

Industrial-Organizational Psychology Topics

Industrial-organizational psychology covers a range of topics that focus on helping businesses create more effective, efficient, and satisfying workplaces.

Here are some of the specific issues addressed by industrial-organizational psychology experts:

• Employee motivation: Professionals in this field may also use psychological principles to help keep workers motivated.
• Employee testing: Psychological principles and tests are often used by I-O psychologists to help businesses select candidates that are best suited to specific job roles.
• Leadership: I-O psychologists may work to help leaders develop better strategies or train managers to utilize different leadership skills to manage team members more effectively.
• Product design: Some I-O psychologists are involved in the development of consumer or workplace products.
• Workplace diversity: Within the area of organizational psychology, professionals in this field may help businesses develop hiring practices that foster greater diversity as well as train employees on diversity and inclusion.
• Workplace performance: I-O psychologists often study behavior in the workplace in order to design environments and procedures that maximize employee performance.

Important People in I-O Psychology History

The field of industrial-organizational psychology has been shaped by a number of influential figures. Their research, theories, and innovations continue to influence modern researchers today. Some of these important thinkers include:

• Frederick W. Taylor: Taylor was a mechanical engineer who published an influential book on improving industrial efficiency.
• Hugo Münsterberg: Munsterberg was an applied psychologist who wrote an early text on how psychology could be used for industrial, occupational, and organizational purposes. His work had a significant impact on the early development of the field. 
• James McKeen Cattell: Cattell was an early proponent of looking at how individual differences influence human behavior. 
• Kurt Lewin: Lewin was an influential applied psychologist who described a number of leadership styles that people may exhibit. His work also focused on looking at all the forces that influence a situation rather than just considering individual behavior.
• Robert Yerkes: Yerkes was a psychologist known for his work in the field of intelligence testing. He developed the Alpha and Beta Intelligence Tests for the U.S. Army, which were used to evaluate military recruits during WWI. Scores on the tests were used to determine respondents' capabilities, including the ability to serve and leadership potential.

A Career in Industrial-Organizational Psychology

Interest in industrial-organizational psychology careers has grown significantly in recent years. Businesses are increasingly aware of the value of applying psychological knowledge to improving the workplace, which has help drive the demand for professionals in this field.

According to employment statistics from the Bureau of Labor Statistics, the mean annual wage for I-O psychologists as of May 2023 was $154,380. The bottom 10% of I-O psychologists earned around $45,860 and the top 10% earned an average of $184,380, with a median annual wage of $219,810.

As with other specialty areas, wages vary depending upon a variety of factors including geographic location, educational background, area of employment, and years of experience in the field. Individuals with a master's or doctorate degree also command higher yearly salaries.

In general, people in large urban areas will find more employment opportunities and higher wages,. However, these benefits are often accompanied by a higher cost of living.

States employing the most I-O psychologists include California and North Carolina. Professionals working in California earned an average of $136,300, while those employed in North Carolina earned an average of $86,400.

Takeaways

Industrial-organizational psychology is an important subfield that can make a real difference in the daily lives of workers in many different industries. Professionals in this field help ensure that the right people are chosen for jobs aligned with their talents and interests, but they also help ensure that organizations develop a culture that supports employee health and safety.

If you are passionate about applying psychological principles to real-world settings, consider a career in industrial-organizational psychology. It can be an excellent choice for people interested in areas such as product design, computers, statistics, and engineering.