Why companies hunt for talent on digital platforms, not in resume piles

Michael Blanding of HBSWK cites new research on digital platforms behind much of the hiring:

When it comes to the job hunt, many of us have a traditional view of what it takes to find a new position: A worker searches for available openings, sends in a resume, and waits for an interview.

Much of academic research assumes that’s the way people find jobs, too. From mathematical models to field studies, researchers tend to think that workers submit resumes to open positions. In fact, scholars have learned a lot about discrimination in labor markets by sending resumes to job postings to see who gets called back and who doesn’t.

As Harvard Business School Assistant Professor Rembrand Koning was talking about such studies with colleagues Ines Black and Sharique Hasan from Duke University’s Fuqua School of Business, however, something about that model didn’t seem right.

“It really didn’t jibe with how a lot of people seem to be getting jobs today,” says Koning, a member of the Strategy Unit. “They’re not sending resumes in. They’re being recruited, often through online platforms like LinkedIn.”

Indeed, the rise of digital platforms now enables firms and recruiters to source potential candidates anywhere in the world in a matter of minutes. Instead of waiting for a worker to apply, firms can now hop on a platform and pick out talent they think would be an especially good fit for their needs.

When Koning and his colleagues set out to learn how many workers were being recruited versus applying for jobs directly, statistics from the 1991 General Social Survey were the best they could find. The data showed only 4 percent of workers were recruited to their current jobs, while another third found jobs through referrals, and the lion’s share—some 60 percent—applied directly. Those figures seemed wildly out of date.

“We said, ‘Hey, no one’s measured this recently, so why don’t we do our own nationally representative survey?” The result is a new working paper, Hunting for Talent: Firm-Driven Labor Market Search in America, that quantifies the steep increase in outbound recruiting by firms largely at the expense of incoming resumes.

 

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