I used to work at Goldman Sachs! How firms benefit from organizational status in the market for human capital

Abstract

How does employer status benefit firms in the market for general human capital? On the one hand, high status employers are better able to attract workers, who value the signal of ability that employment at those firms provides. On the other hand, that same signal can help workers bid up wages and capture the value of employers' status. Exploring this tension, we argue that high status firms are able to hire higher ability workers than other firms, and do not need to pay them the full value of their ability early in the career, but must raise wages more rapidly than other firms as those workers accrue experience. We test our arguments using unique survey data on careers in investment banking. Copyright © 2014 John Wiley & Sons, Ltd.

Stayers versus movers: Social capital and early career imprinting among young professionals

“…Despite an effort to make the survey as respondent friendly as possible, it required up to 2 hours to complete 3 (on the basis of a pilot test), resulting in a response rate of 18.5% (601 of 3,256 target respondents). Although low, the rate compares favorably with the response rates of similar career surveys of professional employees (Bertrand, Goldin, & Katz, 2010;Bidwell, Won, Barbulescu, & Mollick, 2015;Cycyota & Harrison, 2006). Importantly, the data do not reflect a respondent bias as revealed by a comparative analysis (Table 1).of basic demographic characteristics (age, gender, race, nationality, and prestige of the undergraduate institution) between respondents and nonrespondents.…”

Unequal on top: Gender profiling and the income gap among high earner male and female professionals

“…The response rate of 18.5% is relatively low but compares quite favorably with similar career surveys of professional employees (Bertrand et al, 2009;Bidwell et al, 2014;Cycyota and Harrison, 2006). Importantly, the target population to which the survey was distributed included the entire population of alumni in each cohort graduating between 1994 and 2000.…”

Let them go? How losing employees to competitors can enhance firm status

“…Our argument draws inspiration from the literature on interorganizational careers, which documents how individuals' career paths are becoming less likely to progress from job to job within a firm's internal labor market and more likely to progress through employment spells at different firms (Arthur and Rousseau, ; Cappelli, ). Individuals accordingly recognize the likelihood of changing employers during their careers and increasingly favor jobs that provide future external mobility opportunities for career advancement (e.g., Bidwell and Briscoe, ; Bidwell et al, ; Dokko, Wilk, and Rothbard, ; Groysberg and Lee, ; O'Mahony and Bechky, ; Williams, Agarwal, and Chen, ). This literature yields the insight that firms are more and more likely to appeal to prospective employees—especially those at early career stages—not only because of perceived internal opportunities to stay but because of perceived external opportunities to leave.…”