Avoiding Labor Shortages by Employer Signaling: On the Importance of Good Work Climate and Labor Relations

Abstract

Reversing the original signaling model, this study explains how employers signal the non-observable quality of their workplace and thereby reduce labor shortages. Based on a company data set of 204 German firms, the authors find, as predicted by their theory, that the existence of a works council, an apprenticeship training program, and a high-quality incumbent workforce significantly improves recruitment success because they all reliably signal appealing workplaces. At the same time, frequent hiring of workers with non-matching qualifications reduces recruitment success because it signals low-quality workplaces. The authors' research reveals that certain aspects of labor relations and workplace characteristics exert a significant impact on recruitment success, which cannot be explained by conventional theoretical arguments.

Cite this work

No public copy is stored for this record, so only the metadata is cited.

Stored only when both papers are in the corpus — 102 citations exist upstream.

Papers that cite the same references — the relational fallback while embeddings are still backfilling.