Elevator pitch
When hiring new workers, employers use a wide variety of different recruiting methods in addition to posting a vacancy announcement, such as adjusting education, experience or technical requirements, or offering higher wages. The intensity with which employers make use of these alternative methods can vary widely depending on a firm’s performance and with the business cycle. In fact, persistently low recruiting intensity partly helps to explain the sluggish pace of the growth of jobs in the US economy following the Great Recession of 2007–2009.
Key findings
Pros
An employer’s recruiting intensity is an important part of hiring and job creation.
Changes in recruiting intensity can account for some structural or “mismatch” unemployment.
Businesses that are fast-growing recruit more intensely.
Positions that offer higher wages tend to have greater recruiting effort and generate more interviewees per job offer.
Cons
Most theories of the labor market ignore recruiting intensity, so complicating policy analysis.
Recruiting intensity is difficult to measure and is not well understood by economists.
Little is known about which recruiting methods matter most, or which aspects of recruiting intensity might be most responsive to policy. Existing evidence is unable to identify supply- or demand-driven changes in recruiting intensity.