Employer Preferences and Student Beliefs in the Post-College Job Search Process: Experimental Evidence

• In Event: Unpacking the Education-to-Labor-Market Transition and Its Implications for Inequality

Abstract

Authors: Tarikua Erda ; Laura Caron

Abstract

The first job out of college has lasting labor market impacts (see, Kahn 2010), yet the impact of frictions like information asymmetry on students’ job search outcomes remains poorly understood. Partnering with a large, mid-tier public university in the Southeastern US, we conduct incentivized, pre-registered experiments on both employers and job-seeking seniors and juniors to examine: (1) how employers evaluate candidate characteristics, and (2) whether (and which) students accurately understand employer preferences, and how those student beliefs relate to their job search outcomes. 

In line with previous work (eg, Kessler et al. 2019), we find that employers value GPA and the type and amount of previous work experience, and we add new descriptive and experimental evidence that employers rely on information about extracurricular activities to judge candidates’ non-cognitive skills. Students, however, tend to misunderstand employer preferences, generally overestimating the role of professional internships and academics, and underestimating the role of extracurriculars and the number of work experiences. We study how these inaccuracies in beliefs correlate with student demographics, including first generation status, race, and gender. Overall, our preliminary results suggest that students who have more incorrect beliefs about employer preferences  receive fewer interviews and lower wage offers, even when controlling for relevant attributes like GPA. This suggests that our measure of information asymmetry captures an aspect of students’ job search  that is not explained by other measures or proxies. Data to finalize these results will be collected through summer 2025.

Contributions

This work expands on the experimental technique developed by Kessler et al. (2019) and offers a new method for measuring students’ beliefs about employer preferences. Using this method, the paper provides novel evidence on what employers value and what students think employers value, thereby providing key insight to improve the post-college outcomes of students. We also add evidence on an important but understudied context and population of students where, for example, over 30% of students are first generation college students. This setting is especially important given recent evidence that large public universities are major sites of economic mobility (eg, Chetty et al. 2016).This work provides insights for designing policy and programs to improve student job search outcomes, especially in this context.

Works cited:

Chetty, R., Friedman, J. N., Saez, E., Turner, N., & Yagan, D. (2020). Income Segregation and Intergenerational Mobility Across Colleges in the United States. The Quarterly Journal of Economics, 135(3), 1567–1633.

Kahn, Lisa B. "The long-term labor market consequences of graduating from college in a bad economy." Labour Economics 17, no. 2 (2010): 303-316.

Kessler, Judd B., Corinne Low, and Colin D. Sullivan. "Incentivized resume rating: Eliciting employer preferences without deception." American Economic Review 109, no. 11 (2019): 3713-3744.

Author

• Tarikua Erda, New York University
  Presenting Author