Informal Practices, Flexible Firms and Private Labour Markets

Abstract

Interest in informal recruitment methods, and workers' informal job search and acquisition methods, has increased since the recession began. Although evidence (for example, the General Household Survey) does not suggest that the recession has led to a general increase in employers' use of informal methods, significant advances have been made in the theory of informal practices. These ideas are tested against some new evidence from South Wales, and the results are incorporated into a simple model of informal practices which introduces the idea of a `private labour market'. The model suggests that some `recruitment' methods are best seen as contingent and sometimes as the absence of recruitment methods. Finally, the importance of the various stimuli to change in informal practices is considered in the light of the GHS and South Wales evidence.