Explaining Employers' Hiring Decisions: A Comparative Study of Employers' Risk Assessment

In order to investigate the scarring effect of early job insecurity on future employment chances we have implemented a factorial survey experiment with recruiters based on real vacancies in Bulgaria, Greece, Norway and Switzerland. We contribute to recruitment research at least in three ways: First, the multinational design allows us to run comparative analysis across countries, which are carried out along the national dimensions youth unemployment rate, employment protection regulation and type of educational system. Second, we differentiate between two different forms of early job insecurity – unemployment and work experience in deskilling jobs, and we demonstrate that the sole focus on unemployment, as it is the case in the prevalent labour market research, is not sufficient in order to fully understand labour market outcomes caused by different forms of job insecurities. Third, since our sample consists of real recruiters who were hiring for current jobs at the time when the study was carried out, we provide a unique cross-country data set of high external validity. Our findings suggest that scarring effects of early job insecurity vary across countries and across occupational fields, and while scarring caused by work experience in deskilling jobs seems to be enforced by strong employment protection regulations, unemployment scarring seems to stronger where national unemployment is low. Further, the differences in recruiter’s evaluation across occupational fields indicate that signalling value of education may vary depending on specific sectors. Not at least, we contribute to debates around active labour market policies, arguing that measures aiming at quick labour market reintegration without consideration of job quality may not be the most sustainable solution, as work experience in a deskilling job does not lead to better recruiter’s evaluation.