Posting and Slotting: How Hiring Processes Shape the Quality of Hire and Compensation in Internal Labor Markets

Abstract

Recent research highlights the benefits of internal hiring-filling a job by hiring a worker currently employed by the organization-and more than half of jobs are filled that way. Yet we know surprisingly little about the processes that facilitate the movement of workers across jobs within firms. I address this gap by first detailing the portfolio of internal hiring processes employed by large organizations, focusing on posting and slotting. Posting is a predominantly market-based process in which a manager posts an open job and invites interested candidates to apply, whereas slotting is a predominantly relational process in which a manager personally identifies a preferred candidate and ''slots'' him or her into an open job. I then examine how key differences between posting and slotting shape two outcomes of importance to firms and workers: quality of hire and compensation. My analysis of 8,107 internal hires at a large U.S. health-services firm reveals that outcomes for internal candidates depend, in part, on the nature of the process used to facilitate the movement from one job to the next; compared with slotted employees, workers who enter a job through posting have higher performance ratings, earn higher salaries, and are less likely to exit the firm. My findings suggest that the posting process improves the quality of hires by expanding the pool of potential candidates at the recruiting stage and by disciplining the information managers use to evaluate candidates at the selection stage. As well, internal candidates hired through posting are more likely to initiate salary negotiations and negotiate more competitively, resulting in higher initial salaries.

Gender-role Incongruity and Audience-based Gender Bias: An Examination of Networking among Entrepreneurs

“…In addition, the effect of relationship-based concerns is not limited to cases of triadic exchange—research on negotiations has found that individuals sacrifice economic gains to preserve their relationship with exchange partners (Curhan, Elfenbein, and Xu, 2006). For example, recent labor market research has suggested that new hires are less likely to negotiate for higher starting salaries when they are slotted, or hand-picked, for a position by the hiring manager (Keller, 2018).…”

Being Different, Being Absent? A Dynamic Perspective on Demographic Dissimilarity and Absenteeism in Blue-Collar Teams

“…Moreover, in such low-skilled blue-collar contexts sophisticated recruitment processes for internal and external hires are not widespread, and individuals are recruited mainly out of need for further human capital, without considering the (demographic) fit to the team (Brown, Dickens, Gregg Paul, Machin, & Manning, 2001;Keller, 2017). This creates an environment where individuals, especially non-traditional team members, face difficulties in adjusting to their team and are more likely to experience negative contact.…”

“…Some characteristics of our sample (i.e., lack of systematic staffing and socialization procedures), as well as past research findings on diversity-friendly climates and leadership, suggest that companies should attend to the temporal patterning of demographic dissimilarity effects and complement their diversity-friendly recruitment strategies in at least three ways. First, companies might consider using structured recruitment and transfer processes also for lowskilled blue-collar jobs and internal hires (Keller, 2017). Involving the supervisor and potentially also the other members of the recipient team in newcomer selection might heighten their sensitivity to successful integration of demographically dissimilar newcomers and lower the risk of perceptions of negative anchoring events for the newcomers.…”

Brief note about management research on job mobility

“…The processes that organisations use to hire internally—the way that over half of positions are still filled—also influence employability. Organisations use both market-like internal job postings and ‘slotting’, where managers fill positions with people they hand-pick,20 showing how job mobility might be driven by managers and organisations, as well as workers.…”