Job Search with Organizational Size As a Signal

Abstract

It is in workers' interest to leave their jobs if better work can befound, but imperfect information on outside opportunities impedes theirjob search. We describe two theories on workers' search using the organizational size as a proxy for work characteristics and derive hypotheses on how the organizational size distribution in a labor market affects job separations. We test the hypotheses with NLSY 79 data on job separations, finding that diversity in organizational sizes affects worker mobility. Workers are more likely to move within counties with many organizations larger than their current one or many organizations of different sizes and are more likely to leave counties lacking these characteristics. Job changes alter the contents or rewards of work and are thus important for explaining stratification and social mobility. An important feature of the job change process is that many workers search for alternative jobs while holding a job, both implicitly by being willing to consider job information that reaches them through social networks and explicitly by examining want ads or sending out applications. Awareness of job market opportunities allows a worker to change jobs if a better opportunity comes along or to quickly get a new job if the current job is lost. The goal of job search is to find the best alternative possible given personal constraints such as financial difficulty, timing, location, and work environment and social constraints such as job supply, required skills, and discrimination. Sociological models of the job change process seek to model how worker goals and constraints shape the job mobility process. Models of vacancy competition (Briiderl 1992; Sorensen 1977; Tuma 1985) and vacancy chains * Financial assistance from Japan's Ministry of Education, Japan Society for the Promotion of Science is gratefully acknowledged. Two reviewers for Social Forces provided helpful