Calculating the Performance Gain Due to Improved Predictive Validity

Composites of test scores are used in the selection and classification of enlisted personnel. If a selection composite is replaced by a new composite with higher predictive validity, mean performance of the recruits increases. Formulas for calculating the performance gain require simplifying assumptions. Using an example, this research memorandum shows that the formulas are very sensitive to violations of these assumptions and hence are not dependable enough for use in operational decisions.