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SOC355H1- Sifting and Sorting Personal Contacts and Hiring in a Retail Bank- Roberto Fernandez and Nancy Weinberg.docx

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Alexandra Marin

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Sifting and Sorting: Personal Contacts and Hiring in a Retail Bank By Roberto M. Fernandes and Nancy Weinberg Main Findings  Study analyzes use of personal contacts in various stages of the hiring process  Focused on a single large retail bank- empirical tests on various roles each contact plays in each stage  Looks at selection bias on each level as well, and how employee referrals assist in the recruitment and job-hiring phase  Focus on theoretical mechanisms by which social ties may affect hiring process  Found evidence that social contacts favorably influence the composition of the pool of job candidates through referrals  Personal contacts help prepare an individual with information about the organizational screening process  Also referral applicants are more likely than non-referral applicants to apply when market conditions are more favorable  Previous notion: Social stratification theory implies one’s background resources (class and education) translate to income and occupational status  This study focuses more on labor market as a determinant of inequality (industry, structure, class, or firm)  Previous notion: If referrals simply provide employers with information about ‘observable’ qualities and skills (things that can be derived from a resume) than it’s expected that the effect of the referral was limited – this was NOT the case  Found that referrals had advantage over non-referral applicants at both interview AND the job-offer stage, despite previous beliefs that the advantage of referral only applied to acquiring interview and not job  Hiring outcome not driven by markets or networks, but by the actions of concrete organizational actors  Though one is tempted to view social ties as informal manifestations of kin and ethnic relations in a community – they found that personal contacts are formal means by which firms seeks to harness power of social relations for it’s own ends (beneficial for firms to do this)  Aka they rely on those who personally know the candidates to make suitable recommendations  Firm’s recruiters play a significant part in job-hiring  Social Contacts and Hiring  Intensive information: deepens information about the particular job and employer  Extensive information: provides information about a board range of jobs  Both are useful but latter tends to yield better chances of being hired for particular job  Social contact
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