When strong ties are strong – networks and youth labor market entry
AbstractThe conditions under which young workers find their first real post-graduation jobs are both very important for the young’s future careers and insufficiently known given their public policy implications. To study these conditions, and in particular the role played by networks, we use a Swedish population-wide linked employer-employee data set of graduates from all levels of schooling which includes detailed information on family ties, neighborhoods, schools, and class composition over a period covering high as well as low unemployment years. We find that strong social ties (parents) are an important determinant of where young workers find their first job. This remarkably robust effect is estimated controlling for all confounding factors related to time, location, education, occupation, and the interaction of these. The effect is larger if the graduate’s position is “weak” (low education) or during high unemployment years, a pattern which does not emerge when analyzing the role of weak ties (neighbors or friends as measured using classmates and their parents). On the hiring side, by contrast, the effects are larger if the parent’s position is “strong” (e.g. by tenure or wage). We find no evidence of substitution in recruitment over time and fields induced by “family ties hires”. However, we do find that, just after their child is hired in their plant, parents experience a sharp drop in their wage growth. Overall, our results show that strong (family) ties are more important in the job finding process of young workers in weak positions than those weak ties usually measured in the literature (neighbors, in particular), suggesting that labor market experience and education are essential conditions for weak ties to be strong.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by IFAU - Institute for Evaluation of Labour Market and Education Policy in its series Working Paper Series with number 2011:18.
Length: 69 pages
Date of creation: 03 Nov 2011
Date of revision:
Weak ties; social networks; youth employment;
Other versions of this item:
- Kramarz, Francis & Nordström Skans, Oskar, 2011. "When strong ties are strong Networks and youth labor market entry," Working Paper Series, Center for Labor Studies 2011:18, Uppsala University, Department of Economics.
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- J62 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Job, Occupational and Intergenerational Mobility; Promotion
- J64 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Unemployment: Models, Duration, Incidence, and Job Search
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Ghatak, Maitreesh & Guinnane, Timothy W., 1999.
"The economics of lending with joint liability: theory and practice,"
Journal of Development Economics,
Elsevier, vol. 60(1), pages 195-228, October.
- Maitreesh Ghatak & Timothy W. Guinnane, 1998. "The Economics of Lending with Joint Liability: Theory and Practice," Discussion Papers 98-16, University of Copenhagen. Department of Economics.
- Maitreesh Ghatak & Timothy W. Guinnane, 1998. "The Economics of Lending with Joint Liability: Theory and Practice," Working Papers 791, Economic Growth Center, Yale University.
- Ghatak, M. & Guinnane, T.W., 1998. "The Economics of Lending with Joint Liability: Theory and Practice," Papers 791, Yale - Economic Growth Center.
- Olof Aslund & Oskar Nordström Skans, 2010.
"Will I See You at Work? Ethnic Workplace Segregation in Sweden, 1985-2002,"
Industrial and Labor Relations Review,
ILR Review, Cornell University, ILR School, vol. 63(3), pages 471-493, April.
- Åslund, Olof & Nordström Skans, Oskar, 2005. "Will I see you at work? Ethnic workplace segregation in Sweden 1985–2002," Working Paper Series 2005:24, IFAU - Institute for Evaluation of Labour Market and Education Policy.
- Cappellari, Lorenzo & Tatsiramos, Konstantinos, 2010.
"Friends' Networks and Job Finding Rates,"
IZA Discussion Papers
5240, Institute for the Study of Labor (IZA).
- Lorenzo Cappellari & Konstantinos Tatsiramos, 2010. "Friends' Networks and Job Finding Rates," CESifo Working Paper Series 3243, CESifo Group Munich.
- Lorenzo Cappellari & Konstantinos Tatsiramos, 2010. "Friends’ Networks and Job Finding Rates," DISCE - Quaderni dell'Istituto di Economia dell'Impresa e del Lavoro ieil0059, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
- Lorenzo Cappellari & Konstantinos Tatsiramos, 2011. "Friends’ Networks and Job Finding Rates," Discussion Papers in Economics 11/40, Department of Economics, University of Leicester.
- Jonathan Conning, 2000. "Monitoring by Peers or by Delegates? Joint Liability Loans under Moral Hazard," Department of Economics Working Papers 2000-07, Department of Economics, Williams College.
- Kahn, Lisa B., 2010. "The long-term labor market consequences of graduating from college in a bad economy," Labour Economics, Elsevier, vol. 17(2), pages 303-316, April.
- Aslund, Olof & Hensvik, Lena & Nordström Skans, Oskar, 2009.
"Seeking Similarity: How Immigrants and Natives Manage at the Labor Market,"
IZA Discussion Papers
4640, Institute for the Study of Labor (IZA).
- Olof Aslund & Lena Hensvik & Oskar Nordstrom Skans, 2009. "Seeking similarity: How immigrants and natives manage at the labor market," CReAM Discussion Paper Series 0932, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
- Åslund, Olof & Hensvik, Lena & Nordström Skans, Oskar, 2009. "Seeking similarity: how immigrants and natives manage at the labor market," Working Paper Series 2009:24, IFAU - Institute for Evaluation of Labour Market and Education Policy.
- Giovanni Millo & Giacomo Pasini, 2010.
"Does Social Capital Reduce Moral Hazard? A Network Model for Non-Life Insurance Demand,"
Institute for Fiscal Studies, vol. 31(3), pages 341-372, 09.
- Giacomo Pasini & Giovanni Millo, 2006. "Does Social Capital reduce moral hazard? A network model for non-life insurance demand," Working Papers 2006_59, Department of Economics, University of Venice "Ca' Foscari".
- Yannis M. Ioannides & Linda Datcher Loury, 2004.
"Job Information Networks, Neighborhood Effects, and Inequality,"
Journal of Economic Literature,
American Economic Association, vol. 42(4), pages 1056-1093, December.
- Yannis M. Ioannides & Linda Datcher Loury, 2002. "Job Information Networks, Neighborhood Effects and Inequality," Discussion Papers Series, Department of Economics, Tufts University 0217, Department of Economics, Tufts University.
- Cingano, Federico & Rosolia, Alfonso, 2008.
"People I Know: Job Search and Social Networks,"
CEPR Discussion Papers
6818, C.E.P.R. Discussion Papers.
- Corak, Miles & Piraino, Patrizio, 2010. "Intergenerational Earnings Mobility and the Inheritance of Employers," IZA Discussion Papers 4876, Institute for the Study of Labor (IZA).
- Topa, Giorgio, 2001.
"Social Interactions, Local Spillovers and Unemployment,"
Review of Economic Studies,
Wiley Blackwell, vol. 68(2), pages 261-95, April.
- Topa, Giorgio, 1997. "Social Interactions, Local Spillovers and Unemployment," Working Papers 97-17, C.V. Starr Center for Applied Economics, New York University.
- Bandiera, O & Barankay, I & Rasul, I, 2009. "Social Connections and Incentives: Evidence from Personnel Data," Open Access publications from University College London http://discovery.ucl.ac.u, University College London.
- Durante, Ruben & Labartino, Giovanna & Perotti, Roberto, 2011.
"Academic Dynasties: Decentralization and Familism in the Italian Academia,"
CEPR Discussion Papers
8645, C.E.P.R. Discussion Papers.
- Ruben Durante & Giovanna Labartino & Roberto Perotti, 2011. "Academic Dynasties: Decentralization and Familism in the Italian Academia," NBER Working Papers 17572, National Bureau of Economic Research, Inc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Margareta Wicklander).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.