Network Referrals and Self-Presentation in the High-Tech Labor Market

Abstract

The practice of recruiting job candidates sourced through social contacts (i.e., referrals) is pervasive in the labor market. One reason employers prefer to recruit through referrals is that these candidates often present resumes that are perceived to be a better fit for the role. Whereas existing research attributes this pattern to how individuals who make referrals (i.e., referrers) select individuals to refer, we propose a new mechanism: differences in self-presentation. We argue that referral ties increase the candidates’ propensity to engage in self-presentation work, motivating and assisting candidates in presenting their backgrounds to convey fit. We examine this claim by utilizing unique data from an applicant-tracking system containing job applications for positions at U.S.-based high-tech firms between 2008 and 2012. A candidate fixed-effects specification reveals that when a candidate applies to a firm via a referral, he or she tends to showcase a rendition of his or her career history that better matches the target job than when the candidate pursues positions without such ties. Several mechanism checks, combined with supplementary survey evidence, further indicate that the presence of referral ties to the target firm is associated with greater motivation to engage in self-presentation work as well as the provision of different forms of assistance in that work. Supplemental Material: The e-companion is available at https://doi.org/10.1287/orsc.2022.16674 .