What Do Employee Referral Programs Do? Measuring the Direct and Overall Effects of a Management Practice
47 Pages Posted: 11 Jun 2019
There are 2 versions of this paper
What Do Employee Referral Programs Do? Measuring the Direct and Overall Effects of a Management Practice
What Do Employee Referral Programs Do?
Date Written: June 2019
Abstract
Employee referral programs (ERPs) are randomly introduced in a grocery chain. Larger referral bonuses increase referrals and decrease referral quality, though the increase in referrals from having an ERP is modest. However, the overall effect of having an ERP is substantial, reducing attrition by roughly 15% and decreasing firm labor costs by up to almost 3%. This occurs, partly, because referrals stay longer than nonreferrals, but, mainly, because all workers stay longer in treated than control stores, even among stores where no referrals are made. The most-supported mechanism for these indirect effects is that workers value being involved in hiring.
Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
Suggested Citation: Suggested Citation
Here is the Coronavirus
related research on SSRN
What Do Employee Referral Programs Do? Measuring the Direct and Overall Effects of a Management Practice
This is a National Bureau of Economic Research Paper. NBER charges a fee of $5.00 for this paper.
File name: nber.pdf
Size: 0K
If you wish to purchase the right to make copies of this paper for distribution to others, please select the quantity.
