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Dynamics and endogeneity of firms' recruitment behaviour

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  • Ehrenfried, Felix
  • Holzner, Christian

Abstract

We use detailed German data to carefully document how the vacancy-filling hazard evolves from the recruiting firms' perspectives. We further show how firms adjust their search behaviour when they are unable to fill their vacancy within the planned search duration. We find that the vacancy-filling hazard is increasing during the planned search period and that it decreases thereafter. Most applicants arrive early in the recruitment process. Firms' willingness to pay higher wages or to hire less qualified, inexperienced or unemployed applicants increases when firms are unable to hire before the intended starting date. Models of random search, directed search, and stock-flow matching differ substantially in the way they assume that job seekers and firms behave during the recruitment process in these respects and we conjecture that our findings are most readily explained by stock flow matching models - if these were amended by time-consuming screening technologies.

Suggested Citation

  • Ehrenfried, Felix & Holzner, Christian, 2019. "Dynamics and endogeneity of firms' recruitment behaviour," Munich Reprints in Economics 78289, University of Munich, Department of Economics.
    • Handle: RePEc:lmu:muenar:78289
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    JEL classification:

    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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