6 ms·

Recruiters add liquidity to the labor market. I really don't see how they are a bad thing.

by jcroll 11y ago

dangerlibrary 11y ago
As in high frequency trading, additional liquidity also equates to addition volatility. That can be good or bad, but a market needs to have enormous "stickiness" for additional liquidity to be an unalloyed benefit. Labor markets are a good example, with search costs high on both sides of the table, so maybe we grant that point. But there's relatively little evidence that recruiters actually reduce search costs, rather than shifting them around on balance sheets.
- bduerst 11y ago
  I would argue that the job markets are incredibly sticky. With HFT, dollars are fungible and shares usually don't have a regional preference for their buyers. There also isn't a resource cost of acquiring, training, and integrating a new share into your portfolio. Recruiters typically work for for-profit businesses, that maximize returns on sales, meaning they are going to try to charge organizations slightly less than it would cost the organization to do it in house. The increased liquidity in job markets drops the amount of time it takes to match a job opening with a job seeker, which eliminates inefficiencies. You're not factoring in the income difference someone makes by being placed in the ideal job sooner.
  - dangerlibrary 11y ago
    > the income difference someone makes by being placed in the ideal job sooner. I don't know how you can tell what I'm factoring in or not, since I deliberately avoided this calculation. It can benefit either employees or employers, depending on elasticity / market power. In other words: you're not factoring how much faster expensive senior employees can be replaced with recent grads ;). That said, there is also a cost to sloppy, spammy recruiting, illustrated in the other responses: it can end up increasing stickiness if enough people start ignoring all recruiting communication because it is all spam. That makes it even harder/more expensive to recruit, and grows the market for recruiters. There are some nasty incentive structures in there.
lemevi 11y ago
I dislike receiving emails from recruiters, especially when they're multiple times per day when I've never indicated to anyone in anyway that I'm looking for work. The fastest and easiest way I have reduced recruiter email was by just deleting my LinkedIn account. I got them down to like once or twice a week that way. Now I don't get any because any of the ones that continued to email I've asked them to stop.
- vonmoltke 11y ago
  I consider myself lucky if I get more than one a month. I understand the problem that you and others have with deluges of crap, but some of us are appreciative of any interest we get. The "hot" market seems to be rather geographically and specialty limited.
  - lemevi 11y ago
    Recruiter emails are basically spam built from templates. They'll include jobs for which I'm obviously not qualified for if the recruiter knew anything about me. I've received emails that still had the template variables in them or had wrong names. Having followed up on recruiter emails a couple of times I have to also state that it is a less pleasant experience than going through the employer directly. All your communication is through the recruiter and you get no feedback at all. In the case you have done an on site interview and you got to meet people, having be the recruiter telling you that the employer wasn't looking to move forward, with no explanation whatsoever, makes a bad experience even worse. In other words, these aren't lists that I think anyone would want to be on. I agree that some areas are better for jobs than others which is why I live where I do.
    - vonmoltke 11y ago
      Most of my recruiter contacts have been direct recruiters of companies, so when I move forward I am dealing directly with the employer. That said, I haven't found dealing with employers directly to give me any more understanding of my background or information about my progress than dealing with third-party recruiters. I have certainly received my share of terrible recruiter emails, but only from posting my resume on job boards. LinkedIn has been a steady stream of mostly good hits, with the not-so-good hits coming directly from companies.
droopyEyelids 11y ago
Adding fake liquidity actually removes liquidity. Imagine if you were selling your house, and I created a service that would bombard you with 10 fake potential buyers a day. You only have time to deal with 2 buyers a day. Chances are, you'll miss out on everyone who is actually interested. While LinkedIn does not intend to create fake recruitment attempts, it works out the same in the end.
- bduerst 11y ago
  In your hypothetical you would contract a real estate agent who would use their expertise in the market to pick the best offers. Getting 100 offers would mean more competition and the likely hood that your agent finds an even better offer than if you had only received 10. If you have a high quality house, er - I mean, if you have skills that are in demand, I highly recommend you get an agent (like hired.com), because you're probably missing out on those good offers.
- notahacker 11y ago
  But the liquidity isn't fake, hence why the firms pay recruiters rather than waiting for the actually-interested people to beat a path to their door. The jobs are real, as are the candidates willing to actually show up to an interview. If you have a job and no suitable candidates, sourcing them is a valuable service, even if a few people get annoyed by the recruiters (better by them than by the employer...) along the way.
  - Spooky23 11y ago
    Have you ever dealt with a recruiter? Scum that spam people are like real estate agents sponsoring the PTA meeting -- they are trolling for listings.
    - notahacker 11y ago
      Plenty thanks, and on the rare occasions I've actually been remotely interested in the job they're promoting they've been more effective st getting me interviews than responding to actual employers' paid listings with carefully crafted cover letters.
pjc50 11y ago
Recruiters have a serious "market for lemons" problem. Some are good, a lot are terrible spammy bucket shops. Dealing with the bad ones just increases your transaction costs.

Recruiters add liquidity to the labor market. I really don't see how they are a bad thing.

by jcroll 11y ago

Recruiters add liquidity to the labor market. I really don't see how they are a bad thing.

As in high frequency trading, additional liquidity also equates to addition volatility. That can be good or bad, but a market needs to have enormous "stickiness" for additional liquidity to be an unalloyed benefit. Labor markets are a good example, with search costs high on both sides of the table, so maybe we grant that point. But there's relatively little evidence that recruiters actually reduce search costs, rather than shifting them around on balance sheets.

bduerst 11y ago
I would argue that the job markets are incredibly sticky. With HFT, dollars are fungible and shares usually don't have a regional preference for their buyers. There also isn't a resource cost of acquiring, training, and integrating a new share into your portfolio. Recruiters typically work for for-profit businesses, that maximize returns on sales, meaning they are going to try to charge organizations slightly less than it would cost the organization to do it in house. The increased liquidity in job markets drops the amount of time it takes to match a job opening with a job seeker, which eliminates inefficiencies. You're not factoring in the income difference someone makes by being placed in the ideal job sooner.
- dangerlibrary 11y ago
  > the income difference someone makes by being placed in the ideal job sooner. I don't know how you can tell what I'm factoring in or not, since I deliberately avoided this calculation. It can benefit either employees or employers, depending on elasticity / market power. In other words: you're not factoring how much faster expensive senior employees can be replaced with recent grads ;). That said, there is also a cost to sloppy, spammy recruiting, illustrated in the other responses: it can end up increasing stickiness if enough people start ignoring all recruiting communication because it is all spam. That makes it even harder/more expensive to recruit, and grows the market for recruiters. There are some nasty incentive structures in there.

lemevi 11y ago

I dislike receiving emails from recruiters, especially when they're multiple times per day when I've never indicated to anyone in anyway that I'm looking for work. The fastest and easiest way I have reduced recruiter email was by just deleting my LinkedIn account. I got them down to like once or twice a week that way. Now I don't get any because any of the ones that continued to email I've asked them to stop.

vonmoltke 11y ago
I consider myself lucky if I get more than one a month. I understand the problem that you and others have with deluges of crap, but some of us are appreciative of any interest we get. The "hot" market seems to be rather geographically and specialty limited.
- lemevi 11y ago
  Recruiter emails are basically spam built from templates. They'll include jobs for which I'm obviously not qualified for if the recruiter knew anything about me. I've received emails that still had the template variables in them or had wrong names. Having followed up on recruiter emails a couple of times I have to also state that it is a less pleasant experience than going through the employer directly. All your communication is through the recruiter and you get no feedback at all. In the case you have done an on site interview and you got to meet people, having be the recruiter telling you that the employer wasn't looking to move forward, with no explanation whatsoever, makes a bad experience even worse. In other words, these aren't lists that I think anyone would want to be on. I agree that some areas are better for jobs than others which is why I live where I do.
  - vonmoltke 11y ago
    Most of my recruiter contacts have been direct recruiters of companies, so when I move forward I am dealing directly with the employer. That said, I haven't found dealing with employers directly to give me any more understanding of my background or information about my progress than dealing with third-party recruiters. I have certainly received my share of terrible recruiter emails, but only from posting my resume on job boards. LinkedIn has been a steady stream of mostly good hits, with the not-so-good hits coming directly from companies.

droopyEyelids 11y ago

Adding fake liquidity actually removes liquidity. Imagine if you were selling your house, and I created a service that would bombard you with 10 fake potential buyers a day. You only have time to deal with 2 buyers a day. Chances are, you'll miss out on everyone who is actually interested. While LinkedIn does not intend to create fake recruitment attempts, it works out the same in the end.

bduerst 11y ago
In your hypothetical you would contract a real estate agent who would use their expertise in the market to pick the best offers. Getting 100 offers would mean more competition and the likely hood that your agent finds an even better offer than if you had only received 10. If you have a high quality house, er - I mean, if you have skills that are in demand, I highly recommend you get an agent (like hired.com), because you're probably missing out on those good offers.
notahacker 11y ago
But the liquidity isn't fake, hence why the firms pay recruiters rather than waiting for the actually-interested people to beat a path to their door. The jobs are real, as are the candidates willing to actually show up to an interview. If you have a job and no suitable candidates, sourcing them is a valuable service, even if a few people get annoyed by the recruiters (better by them than by the employer...) along the way.
- Spooky23 11y ago
  Have you ever dealt with a recruiter? Scum that spam people are like real estate agents sponsoring the PTA meeting -- they are trolling for listings.
  - notahacker 11y ago
    Plenty thanks, and on the rare occasions I've actually been remotely interested in the job they're promoting they've been more effective st getting me interviews than responding to actual employers' paid listings with carefully crafted cover letters.

pjc50 11y ago

Recruiters have a serious "market for lemons" problem. Some are good, a lot are terrible spammy bucket shops. Dealing with the bad ones just increases your transaction costs.