Do social networks mitigate stigma effects from long-term unemployment?

Abstract

"The processes of job search and firms' search for employees are subject to some peculiarities when it comes to the chances of long-term unemployed to find a new job. As one group of the supply side of the labour market, these persons face special problems: There is a strong stigma of long-term unemployment attached to these persons. It includes, for example, negative perceptions of the existence of necessary formal qualifications, working experience, resilience or motivation to work. Furthermore, long-term unemployment can lead to social isolation, since social contacts are more likely to evolve between persons that have the same status of employment, which, in turn, reduces the access to useful social contacts to employed individuals. It may be expected that especially the group of long-term unemployed faces advantages when having access to the social contacts of Human Resource Managers, because recommendations may counteract the stigma effects that arise from long-term unemployment and possible prejudice employers' HR decision-makers. Using data from the German Job Vacancy Survey from 2016 and 2018, which is a representative paper and pencil survey on establishments in Germany, I investigate how employers judge the work related skills of long-term unemployed and whether this group has higher chances of being hired when an employer uses his or her social contacts to find candidates. Apart from a large number of establishment-specific characteristics, the survey contains information on the recruiting process with regard to long-term unemployed. Establishments are asked whether they had applications from these persons, whether they invited them for an interview and whether they finally employed long-term unemployed individuals. For all three steps of the recruitment process, it is possible to identify employers that recruited long-term unemployed with or without recommendations. The results indicate that employers do not receive more applications from long-term unemployed when using social contacts for search, but if so, long-term unemployed have higher chances of being invited for interviews and finally of being hired as compared to search through other, more formal search channels. Therefore, even though recommendations to an employer may be helpful for long-term unemployed to find a new job, this group seems to lack useful social contacts that are a necessary prerequisite for an application." (Author's abstract, IAB-Doku) ((en))

Cite article

Rebien, M. (2019): Do social networks mitigate stigma effects from long-term unemployment? (IAB-Discussion Paper 16/2019), Nürnberg, 22 p.