Economic Determinants of Applicant Screening Practices: Analysis of the Korean Human Capital Corporate Panel

Abstract

This study reviews employers’ existing recruiting practices and the environment in which these are deployed, and estimates their effect on the employers’ and workers’ outcomes. The Korean Human Capital Corporate Panel spanning years 2005–2013 is used to take stock of employers’ screening of applicants’ personal characteristics, and regressions with fixed effects link the screening practices to firms’ skill needs, skill supply and labor-market constraints. Institutional and market constraints on employers’ conduct are found to affect screening practices more than firms’ skill needs. The existence of HR departments, worker unionization, and applicant pool size have systematic effects. Employers’ skill needs and screening practices, in turn, affect the female share among new hires. HR departments, personnel committees on boards, and foreign management put a constraint on firms’ hiring discrimination, effectively supporting women’s cause.