Job Search Channels Research Articles

What's the Value of Social Capital? A Within-Person Job Offer and Choice Test

Whether and how social capital derived through social ties creates value has animated substantial research in management, sociology, economics, and political science. Scholars are now generally inclined to believe that social ties have an impact on labor market outcomes — that is, it is “who you know” that counts. Two mechanisms were initially identified to explain why this is the case: access to a better distribution of offers in terms of pay or non-redundant information that facilitates job offer. The evidence informing each theory, however, was often inconsistent and circumstantial. In this research we propose and test a unified model of these two theoretical approaches. We do so leveraging unique data on contemporaneous job search with detailed information about job search channels and offer characteristics in alternative-specific job attributes and choice models. We find that contrary to conventional wisdom, search through social networks typically results in job offers with lower total compensation (e.g., -18.0% for those derived through referrals from family and friends v. formal recruiting, -15.4% for those derived via alumni referrals). However, offers derived through weak bridging ties such as alumni contacts are more likely to be accepted because they are perceived as having better growth prospects, and students are willing to accept a significant total compensation discount to accept offers derived via school faculty and students they did not know prior to matriculation because they afford access to industries that are otherwise difficult to access. On balance, our tests are consistent with Granovetter’s argument that the value networks afford is information about opportunities that are otherwise difficult to access rather than a better distribution of offers in terms of pay.

What’s the Value of Social Capital?A Within-Person Job Offer and Choice Test

Whether and how social capital derived through social ties creates value has animated substantial research in sociology, economics, and political science. Amongst the most active lines of research on the matter considers whether social ties improve labor market outcomes. Two primary analytical approaches have been employed to this end. One considers whether social ties help individuals find work. A second approach considers whether social ties lead to jobs with better attributes (e.g., pay), contingent on finding work. Sociologists are generally inclined to believe that social ties have a causal impact on labor market outcomes—that is, it is “who you know that counts” to some degree. However, the evidence informing this belief is circumstantial and often inconsistent. This is particularly true with respect to the second approach concerning whether the use of social ties leads to jobs with more favorable characteristics. In this research we propose and test a model that addresses prior criticisms of the latter approach by leveraging unique data on contemporaneous job search with detailed information about job search channels and offer characteristics. Contrary to conventional wisdom, we find that search through social networks typically results in job offers with lower total compensation. However, net of compensation, job offers derived through alumni contacts (weak ties) as well as thorough family and friends are more likely accepted.

Job Search Channels, Neighborhood Effects and Wages Inequality in Developing Countries: The Colombian Case

This paper analyses the relationship between social networks and the job search behaviour of individuals. Networking is not only based on friends and relatives but also on neighbourhood. The geographic closeness is associated to social interactions. Individuals who are in physical and social proximity share the same sources of information, because they divide individual characteristics or because they learn from one another's behaviour.Using data from Colombia in 2009 we explore how neighbourhoods have an effect on the channel used to search for a job (formal vs informal). People tend to opt for a formal or informal channel depending on the channel selected by employed people in their neighbourhood. In addition, we study the wage premium in using a formal or informal channel, exploring the inequality that can arise using a different job search method.Our results show that the neighbourhood affects the individual's job search method and referral workers earn less wage at the bottom of the wage distribution with respect to non-referred workers. At the top of the wage distribution the difference observed is due to different characteristics between the two groups. Colombia presents persistent high levels of informality and inequality. These features impose important social and economic costs such as low tax collection, low employee protection and deficiencies in the labour intermediation process with strong informational asymmetries in the job search. New policies to regulate the labour market are need.

Which One to Choose? Evidence on the Choice and Success of Job Search Methods

This paper empirically investigates the determinants of the choice of six different job search channels and the job search intensity, and the resulting success in terms of employment uptake of the job seeker. The channels comprise the public employment agency, advertisements in newspapers and journals, internet job search, recruitment agencies, direct applications, and personal contacts. In line with the findings for other countries, the results show that consideration of a larger number of channels raises the employment chances. The estimates of the determinants exhibit specific patterns for the choice of the single channels and the level of search intensity. The results of success of the job search channels reveal that the public employment agency is ineffective and harms the employment chances of the unemployed job seekers. In contrast, direct applications for jobs increase the employment chances. <bold>Zusammenfassung</bold> In dieser Arbeit werden die Determinanten für die Auswahl von sechs Wegen der Arbeitsuche sowie die der Suchintensität empirisch analysiert und der dazugehörige Arbeitsmarkterfolg in Bezug auf die Aufnahme einer Beschäftigung untersucht. Die sechs unterschiedenen Wege umfassen die Suche über die Arbeitsagentur, Anzeigen in Zeitungen und Zeitschriften, das Internet, private Arbeitsvermittler, Initiativbewerbungen und persönliche Kontakte. In Übereinstimmung mit den Ergebnissen für andere Länder zeigt sich, dass die Berücksichtigung einer größeren Zahl von Suchwegen die Beschäftigungschancen erhöht. Die geschätzten Effekte für die Determinanten zeigen spezifische Muster im Hinblick auf die einzelnen Suchwege sowie für die Suchintensität. Aus den Ergebnissen des Arbeitsmarkterfolgs wird deutlich, dass die Einschaltung der Arbeitsagentur vergleichsweise ineffektiv im Hinblick auf die Beschäftigungschancen ist. Initiativbewerbungen erhöhen die Beschäftigungschancen dagegen deutlich. <italic>JEL Classification: J64, J62, J20</italic> Received: February 23, 2010 Accepted: November 10, 2010

Job Search Channels and Educational Level in China: Testing the Screening Hypothesis

Using data from a nation-wide survey of graduates undertaken in 2003, this article tests the screening hypothesis for the graduate job market by investigating the relationship among job search channels, educational level and the results of job searches. It is found that those at a lower educational level are more likely to choose informal channels. This is supportive of the screening hypothesis, since those with higher levels of education have a stronger signal and fewer motivations to use informal channels. Meanwhile, the effect of educational background on the probabilities of obtaining a job does not change with different search channels. This empirical result seems to reject the screening hypothesis. However, based on a discussion of the methods, we reach conclusions supportive of the screening hypothesis.

Job Search Channels and Educational Level in China: Testing the Screening Hypothesis

Using data from a nation-wide survey of graduates undertaken in 2003, this article tests the screening hypothesis for the graduate job market by investigating the relationship among job search channels, educational level and the results of job searches. It is found that those at a lower educational level are more likely to choose informal channels. This is supportive of the screening hypothesis, since those with higher levels of education have a stronger signal and fewer motivations to use informal channels. Meanwhile, the effect of educational background on the probabilities of obtaining a job does not change with different search channels. This empirical result seems to reject the screening hypothesis. However, based on a discussion of the methods, we reach conclusions supportive of the screening hypothesis.

Social Networks and Labour Market Outcomes: The Non-Monetary Benefits of Social Capital

We contrast Granovetter's hypothesis (Granovetter, M. (1973). American Journal of Sociology, 78, 1360-1380; Granovetter, M. (1974). Getting a Job: A Study of Contacts and Careers. University of Chicago Press; Granovetter, M. (1995). Getting a Job: A Study of Contacts and Careers. University of Chicago Press) that social networks help individuals to find better-paid jobs with a new model, which predicts that networks are helpful with respect to non-pecuniary job characteristics but not concerning the monetary pay-offs. Following Montgomery (Montgomery, J. D. (1992) American Sociological Review, 57, 586-596), our model is a combination of classical job-search theory and the network hypothesis. First, concerning the monetary consequences, we test our hypotheses empirically by analysing the 2001 International Social Survey Programme on social relations and support systems. We show that using social ties is a common job-search strategy in all countries. However, using social networks does not increase the monetary pay-off. Second, we use a sample of 8,000 Swiss university graduates who recently entered the labour market to show that informal job-search channels are beneficial with respect to important non-monetary job characteristics. Thus, graduates who received their jobs through social contacts tended to get jobs that are linked to their educational degree and offer better career perspectives. Furthermore, using personal networks is related to lower search costs. Therefore, the results suggest overall that networks improve the non-pecuniary characteristics but not the monetary pay-offs.

Determinants of schooling returns during transition: Evidence from Chinese cities

This paper uses 1988 and 1995 data from a national household survey to study across-region dispersions and changes over time in returns to education for a large number of Chinese cities and to analyze the determinants of schooling returns during economic transition. On average, the estimated rates of return at the city level increased from 3.1 to 5.1% between these two years and the dispersion widened significantly. During the same period, the gender earnings gap increased and the returns to experience and Communist membership rose sharply. Individual cross section and city-level panel data suggest that the presence of foreign and joint-venture firms, market job search channels, and information infrastructure contributed to increased returns to education. However, the size of the state sector constrained schooling returns. Journal of Comparative Economics 33 (2) (2005) 244–264.