The field of business psychology, also called industrial/organizational (I/O) psychology, refers to the scientific analysis of human behavior as it applies to the workplace and other organizations. Business psychology focuses on the study of individual, group and organizational behavior and then applying it to solve various types of problems in the workplace.
What is Business Psychology?
Business psychology work requires specialized training and knowledge in behavior as it applies to the workplace. It requires the psychologist to have a deep knowledge the following:
- Career development
- Organizational development
- Decision theory
- Human performance and human factors
- Consumer behavior
- Small group theory
- Criterion theory and development
- Job and task analysis
Also, working in business psychology requires extensive understanding of ethical issues, including administrative, statutory and case law related to workplace activities. Some of the problems that I/O and business psychologists address specifically include:
- Recruiting and retaining the best employees
- Selecting and placing employees in the best positions for their skills
- Improving work quality to improve worker productivity
- Consumer behavior and how to influence it with efficient work processes
- Training and development of new and existing employees
- Improving communication between company departments
Business Psychology Degree Opportunity
ABC News reported in 2015 that the field of I/O psychology was one of the fastest growing fields in the US. The report stated that there would be growth of 40% to 50% by 2022, which is much faster than average.
It should be noted that the entire field of business and I/O psychology is one of the smallest that is tracked by the Bureau of Labor Statistics (BLS). However, the ABC report suggests that there is ample room for growth in this small but thriving field.
BLS reports as of 2016 that job demand in the field was an average 6% through 2026, but it is possible that certain fast-growing business sectors will see more rapid growth.
Professionals who earn their master’s or doctoral degree in business psychology will find the most job opportunities in these states, according to BLS:
- New Jersey
Business Psychology Degree Career Paths
The vast majority of professionals in the business psychology field will become I/O psychologists. There is growing demand for their services in many business sectors in America today. BLS states that the following industries are showing the highest need for business psychologists, as well as the annual mean wage in each area:
- Scientific research and development services: $123,900
- Management, scientific and technical consulting services: $98,600
- State government: $78,300
- Colleges, universities and professional schools (teaching): $67,250
- Management of companies and enterprises: $122,630
Business Psychology Degree Salaries
BLS reports that the mean annual wage for I/O and business psychologists is $104,570. It also reports that the median annual wage for all psychologists is $75,230. The median salary for I/O psychologists in 2016 was $82,760.
Business Psychology Degree Employers
BLS reports that psychologists work in the following industries:
- Self employed: 24%
- Government: 10%
- Hospitals: 7%
- Elementary and secondary schools: 27%
However, most business psychologists tend to work on a contractual basis for medium and large companies across the country. In some cases, an I/O psychologist may be hired full time in an HR department to provide support to that department when it is hiring workers, and also training and developing them to be more productive.
Business Psychology Bachelor’s Degree
Students who are interested in business psychology eventually must earn at least a master’s degree in this field. It is recommended to earn a bachelor’s degree in psychology so that you have the necessary background to be successful in graduate school.
Business Psychology Master’s Degree
The master’s degree is the minimum degree needed to work in business psychology. In this two or three year program, you will study the behavior of individuals, businesses and organizations to see how you can help them to boost productivity and performance. Students in this type of graduate program will learn how to use measurement and research skills to solve critical workplace issues, and to apply psychological principles to HR and various leadership challenges that companies face today.
The core curriculum in this master’s program is typically grounded in quantitative analysis that will ready you to perform meaningful research and to analyze data that drives major change in organizations for the better. This program typically will teach you the following types of skills:
- How to recruit, retain and select the best employees
- Identify the type of training that employees need.
- Create innovative employee and leadership development training.
- Address challenging workplace issues, including anti discrimination and diversity
- Devise and manage job satisfaction and employee opinion polls
- Analyze how effective various workplace training programs are
- Assess how well individual employees are performing
Business Psychology Degree Admission Requirements
To be admitted into a competitive I/O or business psychology program, you will often need to meet the following criteria:
- 0 or higher GPA
- Background and work experience in psychology
- 3 professional and/or academic references
- GRE or GMAT scores
- Writing samples and/or personal statement of career goals
Business Psychology Degree Curriculum
Each graduate program will establish its own curriculum and graduation standards. It is important to select a university and a program that has been properly accredited to ensure that you are learning what you need to be successful in this field. If you are taking a graduate program on campus, you should check that the program has been accredited by the American Psychological Association or APA.
Typical courses you may take in this program are:
- Applied Industrial Psychology
- Applied Psychological Research Methods I
- Applied Psychological Research Design
- Competency Modeling and Criterion Development
- Seminar: Industrial/Organizational Psychology
- Applied Measurement Theory
- Applied Organizational Psychology
- Applied Cross-Cultural Industrial/Organizational Psychology
- Workforce Training and Development
- Applied Organizational Development
- Applied Psychological Research Methods II
- Succession Planning and Leadership Development
- Capstone: Practicum and Skills Development
Business Psychology Degree Financial Assistance
Earning a master’s degree can be expensive, and it is no exception in the field of business psychology. But given the increased need for these professionals to advise companies on improving their workplace practices, there is financial help available from the following grants and scholarships:
- Grawemeyer Award in Psychology: $100,000
- Frank X. Barron Award: Amount varies
- Fontana Transport, Inc.: $5000
- Health Careers Scholarship Program: $7500
- Stephanie Nicole Ross Foundation Graduate Scholarship: $1000
- Esther Katz Rosen Fund Grants: $1000 to $50,000
- Genton-Meier Scholarships: $2500
- Scott and Paul Pearsall Scholarship: $10,000
- Violet and Cyril Franks Scholarship: $5000
Business Psychology Degree Associations
Students who are interested in a career in business psychology may wish to review some of these associations below. Belonging to one or more of them may expand your business psychology career options and potential:
- Society for Industrial and Organizational Psychology (SIOP)
- Alliance for Organizational Psychology
- American Psychological Association (APA)
- International Positive Psychology Association
Business Psychology Degree Summary
The field of business psychology is thriving, and students who earn a master’s or doctoral degree in the field should find ample job opportunities in many industries.
- 20 Fastest Growing Jobs. (2015). Retrieved from http://abcnews.go.com/Business/americas-20-fastest-growing-jobs-surprise/story?id=22364716
- Industrial Organizational Psychologist Overview. (n.d.). Retrieved from http://www.apa.org/ed/graduate/specialize/industrial.aspx
- Psychologist. (2015, Dec. 18). Retrieved from https://www.bls.gov/ooh/life-physical-and-social-science/psychologists.htm