Abstract

http://ssrn.com/abstract=2024455
 
 

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Boarding a Sinking Ship? An Investigation of Job Applications to Distressed Firms


Jennifer Brown


Northwestern University - Kellogg School of Management

David A. Matsa


Northwestern University - Kellogg School of Management; National Bureau of Economic Research (NBER)

January 24, 2013

AFA 2013 San Diego Meetings Paper

Abstract:     
We use novel data from a leading online job search platform to examine the impact of corporate distress on firms’ ability to attract job applicants. Survey responses suggest that job seekers accurately perceive firms’ financial health, as measured by the companies’ credit default swap prices. Analyzing responses to job postings by major financial firms during the recent financial crisis, we find that an increase in an employer’s distress results in fewer and lower quality applicants. These effects are particularly evident when the social safety net provides workers with weak protection against unemployment and for positions requiring advanced training.

Number of Pages in PDF File: 51

Keywords: labor supply, corporate distress, unemployment risk, employee recruitment, job applications

JEL Classification: G20, G32, G33, J64, M5

working papers series


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Date posted: March 19, 2012 ; Last revised: January 25, 2013

Suggested Citation

Brown, Jennifer and Matsa, David A., Boarding a Sinking Ship? An Investigation of Job Applications to Distressed Firms (January 24, 2013). AFA 2013 San Diego Meetings Paper. Available at SSRN: http://ssrn.com/abstract=2024455 or http://dx.doi.org/10.2139/ssrn.2024455

Contact Information

Jennifer Brown
Northwestern University - Kellogg School of Management ( email )
2001 Sheridan Road
Evanston, IL 60208
United States
David A. Matsa (Contact Author)
Northwestern University - Kellogg School of Management ( email )
2001 Sheridan Road
Evanston, IL 60208
United States
847-491-8337 (Phone)
847-491-5719 (Fax)
National Bureau of Economic Research (NBER) ( email )
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
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