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Social networks and regional recruitment of foreign labour: Firm recruitment methods and spatial sorting in Denmark

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  • Torben Dall Schmidt
  • Peter Sandholt Jensen

Abstract

This paper tests the hypothesis that social networks are crucial for regional recruitment and inflows of foreign labour. New survey data on 971 firms located in Region Southern Denmark show that the predominant recruitment method of foreign labour was through networks. Danish municipal data from 1997–2006 furthermore reveal spatial sorting since initial shares of employees with a foreign background out of total regional employment predict foreign labour inflow rates to regional employment. Thus, social networks appear crucial for the recruitment and inflows of foreign labour, suggesting that employee referrals and information about vacancies in local job markets are also important for foreign labour. Resumen Este artículo pone a prueba la hipótesis de que las redes sociales son cruciales para la contratación regional y los flujos de mano de obra extranjera. Nuevos datos de una encuesta sobre 971 empresas ubicadas en la Región de Dinamarca Meridional muestran que el método de contratación predominante de mano de obra extranjera fue a través de redes. Datos municipales daneses de 1997‐2006 revelan además una clasificación espacial, ya que las cuotas iniciales de empleados de origen extranjero respecto del empleo regional total predicen tasas de afluencia de mano de obra extranjera para el empleo regional. Por tanto, las redes sociales parecen ser cruciales para el reclutamiento y la afluencia de mano de obra extranjera, lo cual sugiere que las referencias de los empleados y la información sobre ofertas de empleo en los mercados laborales locales son también importantes para la mano de obra extranjera.

Suggested Citation

  • Torben Dall Schmidt & Peter Sandholt Jensen, 2012. "Social networks and regional recruitment of foreign labour: Firm recruitment methods and spatial sorting in Denmark," Papers in Regional Science, Wiley Blackwell, vol. 91(4), pages 795-821, November.
  • Handle: RePEc:bla:presci:v:91:y:2012:i:4:p:795-821
    DOI: 10.1111/pirs.2012.91.issue-4
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    1. Torben Schmidt & Peter Jensen, 2013. "Foreign labor and regional labor markets: aggregate and disaggregate impact on growth and wages in Danish regions," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 50(3), pages 809-840, June.
    2. KUEPIE Mathias & TENIKUE Michel & WALTHER Olivier, 2014. "Small businesses performance in West African border regions: Do social networks pay off?," LISER Working Paper Series 2014-06, Luxembourg Institute of Socio-Economic Research (LISER).
    3. Mette Foged & Giovanni Peri, 2013. "Immigrants' and Native Workers: New Analysis on Longitudinal Data," NBER Working Papers 19315, National Bureau of Economic Research, Inc.

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