Not Just for Investors: The Role of Earnings Announcements in Guiding Job Seekers

65 Pages Posted: 14 Jan 2021 Last revised: 21 Jan 2024

See all articles by Bong-Geun Choi

Bong-Geun Choi

Yonsei University; Fount Investment Co., Ltd.

Jung Ho Choi

Stanford Graduate School of Business

Sara Malik

University of Utah - David Eccles School of Business

Date Written: March 31, 2023

Abstract

Using detailed search data from half a million anonymous job seekers, we study the information content of earnings announcements for job seekers. In the spirit of Beaver (1968), we find evidence that job seekers initiate job-search activity in response to a prospective employer’s earnings announcements. Job seekers search more actively for employers with media coverage and earnings growth, consistent with the attention and information roles of earnings announcements. We find corroborating evidence about the usefulness of earnings announcements’ financial information content to job seekers: (1) a survey experiment indicates that job seekers are more willing to apply to firms when provided with evidence of positive performance, (2) job seekers search for financial information during applications and interviews, and (3) financial information is predictive of future job prospects, including job openings and career growth. Overall, our paper suggests earnings announcements—among other sources—prompt and guide job seekers’ search activities.

Keywords: Job Search, Job Prospects, Implicit Claims, Earnings Announcements, Financial Reporting, Recruitment

JEL Classification: D83, J62, J64, M12, M21, M41, M46

Suggested Citation

Choi, Bong-Geun and Choi, Jung Ho and Malik, Sara, Not Just for Investors: The Role of Earnings Announcements in Guiding Job Seekers (March 31, 2023). Stanford University Graduate School of Business Research Paper No. 3924, Journal of Accounting & Economics (JAE), Forthcoming, Available at SSRN: https://ssrn.com/abstract=3744498 or http://dx.doi.org/10.2139/ssrn.3744498

Bong-Geun Choi

Yonsei University ( email )

Seoul
Korea, Republic of (South Korea)

Fount Investment Co., Ltd. ( email )

416 Hangang-daero, Jung-gu
SeoulSquare 13/F, WeWork
Seoul
Korea, Republic of (South Korea)
01039807919 (Phone)

Jung Ho Choi (Contact Author)

Stanford Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305
United States
650-721-8434 (Phone)

Sara Malik

University of Utah - David Eccles School of Business ( email )

1645 E Campus Center Dr
Salt Lake City, UT 84112-9303
United States

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