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Immigration, social networks and occupational mismatch

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  • Alaverdyan, Sevak
  • Zaharieva, Anna

Abstract

In this study we investigate the link between the job search channels used to find employment and the probability of occupational mismatch. Our specific focus is on differences between natives and immigrants. We use data from the German Socio-Economic Panel (SOEP, 2000–2014). First, we document that referral hiring is the most frequent single channel of generating jobs in Germany; in relative terms referrals are used more frequently by immigrant workers compared to natives. Second, referral hiring is associated with the highest rate of occupational mismatch among all channels in Germany. We combine these findings and use them to develop a search and matching model with two ethnic groups, two search channels and two occupations. Our model predicts that higher rates of referral hiring produce more frequent occupational mismatch of the immigrant population compared to natives. This prediction and the underlying mechanism of the model are confirmed by the data.

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  • Alaverdyan, Sevak & Zaharieva, Anna, 2022. "Immigration, social networks and occupational mismatch," Economic Modelling, Elsevier, vol. 114(C).
    • Handle: RePEc:eee:ecmode:v:114:y:2022:i:c:s0264999322001821
    DOI: 10.1016/j.econmod.2022.105936
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    Cited by:

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    3. Neugart, Michael & Zaharieva, Anna, 2018. "Social Networks, Promotions, and the Glass-Ceiling Effect," Center for Mathematical Economics Working Papers 601, Center for Mathematical Economics, Bielefeld University.
    4. Stefan Jestl & Michael Landesmann & Sebastian Leitner & Sandra M. Leitner & Isilda Mara & Maryna Tverdostup, 2023. "wiiw Studies on the Integration of Middle Eastern Refugees in Austria, Based on FIMAS Surveys and Register-based Labour Market Career Data," wiiw Policy Notes 74, The Vienna Institute for International Economic Studies, wiiw.
    5. Zhou, Ying & Fan, Zhaobin & Anwar, Sajid, 2023. "Birthplace diversity of immigrants, capabilities and export structure transformation," Economic Modelling, Elsevier, vol. 119(C).
    6. Pierre Georges Van Wolleghem & Marina De Angelis & Sergio Scicchitano, 2023. "Do informal Networks Increase Migrants’ Over-Education? Comparing Over-Education for Natives, Migrants and Second Generations in Italy and Assessing the Role of Networks in Generating It," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 9(1), pages 175-197, March.
    7. Van Wolleghem, Pierre Georges & De Angelis, Marina & Scicchitano, Sergio, 2019. "Education-occupation mismatch of migrants in the Italian labour market: the effect of social networks," GLO Discussion Paper Series 398, Global Labor Organization (GLO).

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    More about this item

    Keywords

    Job search; Referrals; Social networks; Occupational mismatch; Immigration;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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