Negotiate Overcoming early job-insecurity in Europe

Survey Experiment

Introduction

During spring 2016, four research institutes from the NEGOTIATE consortium conducted a coordinated survey directed at employers in Norway, Bulgaria, Greece and Switzerland. Here we present some main findings from this survey. The survey and this report would not have been possible without the contribution from employers and recruiters in the four countries. We are deeply grateful for their positive contribution and feedback. We hope these first descriptive results from the project can be of interest and use in their work. We also hope you will continue to follow us in our work, through this website and different publications.

This interactive report presents different aspects of the survey. First we will give a short Introduction to the background for the survey and describe the strategy used. We will continue to present some main characteristics of the labour markets in the four countries and point to some country differences identified through the survey. Finally we will show you some preliminary results from the experiment conducted as part of the survey. More detailed results for each of the participating countries in native languages can be found here:

Background

The survey is part of Work Package 7 – Negotiating employers. Three reports describing theoretical and methodological aspects of the approach in greater detail as well as a first report on comparative findings are already published and can be downloaded here.

Theoretical background

Persisting consequences of employment instability and unemployment have come to be known in academic literature as “scarring effects”. Different theoretical explanations have been proposed in order to frame and explain those effects. Both demand (employer related) as well as supply-side (job-applicants) factors may be seen as driving mechanisms of scarring effects.

In order to overcome the supply-side bias in research on the negative consequences of unemployment, the aim of the study is to examine the role that employers play in the inclusion and exclusion of young adults who have experienced early job insecurity in the labour market. The impact of education, economic labour market conditions and employment policies on employer behaviour are of special interest. What kind of job biographies are recruiters looking for and what experiences are examined with caution?

One of the basic problems employers face during recruitment is the limited amount of accessible information on job applicants. Within a short space of time and with limited resources recruiters try to find out as much as possible about the job candidates’ productivity. During the first stage of the hiring process, employers often have to rely entirely upon limited information extracted from CVs. The questions regarding what sort of information they draw upon from the CVs in order to predict the suitability of the candidates for a specific position, and how they interpret this information have brought about many studies in social sciences building on different theoretical concepts: human capital theory, job market signalling theory and employer discrimination theory. These theories are used as the theoretical backdrop for comparisons across four countries.

The survey

The international recruiter survey was implemented in five occupational fields including manufacturing, finance, gastronomy, health and information technology. This was done in order to represent heterogeneous job characteristics with respect to skill level, gender share, innovation dependency, and turnover rates. Four countries that vary in their economic situation (e.g., youth unemployment) and in their educational and labour market policies (e.g., relevance of vocational education and training and employment regulation) were selected: Bulgaria, Greece, Norway, and Switzerland. In order to gauge the impact of multiple factors when young people apply for jobs, an innovative employer-sided online-survey with an integrated vignette experiment and choice task was employed. The sample comprises real vacancies and real recruiters in Bulgaria, Greece, Norway and German-speaking Switzerland. Data was collected from May to June 2016. 2885 recruiters responded to the survey and assessed a total of 20,600 CVs of fictive job applicants.

For more details on the survey, methodology and response rates see the working paper 7.2 – Understanding unemployment scars: A vignette experiment of employers’ decisions in Bulgaria, Greece, Norway and Switzerland.

Results

Results from the survey include survey responses from the participating recruiters as well as their evaluations of the fictive CVs. Below we explore some of these responses to describe differences and similiarities in the recruiters situation and the jobs available for young applicants across the four countries and five sectors before we turn to the CV ratings.

Our intention here is only to give a first impression of the results from the survey. We will thus not provide lengthy explanations, interpretations or analyses of the observed results. More in-Depth analyses of the material will be published in the working paper series from the NEGOTIATE Project as well as in academic publications. New publications will be added to the publications section througout the lifetime of the project.

To get a first idea of the recruiters situation and the hiring processes we investigate how hard it was to find a candidate for the position.

We observe relatively large differences between both countries and sectors in the perceived difficulty of finding the right candidate for the job. Overall, the Norwegian recruiters find it easier to recruit a good candidate for the job. The largest challenges are experienced by the Bulgarian recruiters and in particular those recruiting for the restaurant sector.

What activities during unemployment do recruiters reward or penalise?

In order to understand how recruiters make evaluations in a hiring process we have asked recruiters directly about the importance of a series of activities during non-employment when they assess applicants for skilled jobs.

Recruiters value most when job applicants have enrolled in occupation specific further education during non-employment spells. Having enrolled in a computer course, and to a lesser degree in a language course, is also appreciated in all four countries. In contrast, giving no explanation about gaps in one’s CV is assessed strongly negative, especially in Norway and Switzerland. Recruiters seem to disagree about the relevance of some other activities across countries. For example, both maternity/paternal leave and having travelled/holiday are more critically assessed in Bulgaria and Greece than in Norway and Switzerland. Recruiters in the latter two countries are in turn much more vigilant if job applicants took some time out due to health reasons. Finally, recruiters in Switzerland, and to some extent in Norway, assess a job applicant’s enrolment in an employment scheme for the unemployed (ALMP) negatively, whereas such measures are more positively evaluated in Greece. The findings show that job applicants have some options to convince employers when they use periods of non-employment for certain activities, or when they write up their CV.

The risk of job hopping for one’s professional career

Recruiters have been asked whether they would have any reservations to hire a person who has been unemployed during the last two years, or to hire a person who has been changing jobs frequently, the so called job hopper.

Job hopping was considered considerably more problematic compared to unemployment in all four countries. The difference between the two forms of employment insecurity is however most striking in Greece, where 57% of recruiters show unconditional reservations towards job hoppers but only 9% towards the unemployed. Hence, job hopping turns out to be a bigger issue for recruiters than unemployment.

Evaluation of virtual CVs

While the impact of unemployment on later employment careers has been studied extensively, little is known about persisting consequences – the so called scarring effects – of having worked in deskilling jobs. Working in any job may be expected to be deskilling in that previously acquired qualifications are no longer used and further trained. We used the example of having worked in a call centre for an extended period of time to gauge deskilling job experience that might be sanctioned in the recruitment process for skilled jobs.

Our results obtained from the factorial survey experiment of our study indeed suggest that recruiters penalize job applicants with extensive work experience in deskilling jobs. In all four countries, their chances to be considered for an advertised skilled position are lower than those of their skilled competitors. Scarring effects for call centre work are stronger in Norway and Bulgaria than in Greece and Switzerland. Unemployment bears pronouncedly negative consequence in countries with relatively low unemployment rates (Switzerland and Norway), although unemployment scarring seems to be moderate compared to having worked in deskilling jobs.

The stronger unemployment scarring in Norway compared to Switzerland also indicates that when national unemployment rates are at a comparable level, the strictness of employment protection legislation (stricter in Norway than Switzerland) may play a determining role in recruiters’ decision whether to employ applicants who have experienced early job insecurity. Furthermore, in Switzerland upper secondary vocational degree holders are more affected by unemployment scarring than higher education graduates. While VET graduates in countries with a pronounced dual VET system enjoy in general high employability –  since employers’ trust in VET credentials is high – they are the first ones to be penalised if they have experienced unemployment.

Conclusions

Our results suggest to distinguish between different forms of early job insecurity. A sole focus on unemployment is not sufficient to fully understand how early job insecurity affects labor market outcomes. Other forms of early employment insecurities such as work in deskilling jobs and job hopping can be detrimental to a young worker’s professional career. Indeed, our findings demonstrate that scarring effects resulting from various early job insecurities are not necessarily driven by the same institutional forces.

The finding that unemployment scarring is more pronounced in economically well-performing countries with a relatively low youth unemployment rate such as Switzerland and especially Norway exhort to be cautious with dramatising unemployment scarring in countries that are especially affected by youth unemployment (Bulgaria and especially Greece), at least as far as employer-sided scarring effects are concerned.

Our evidence for strong negative consequences associated with work in deskilling jobs contributes to debates about labor market activation policies. Unemployment measures aiming at a quick labor market reintegration of the young unemployed without the consideration of job quality may not be a sustainable solution, since deskilling jobs may be dead-end jobs that do not help increase or, worse, may even decrease their employability.

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