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Internal Promotion versus External Recruitment in Industrial Plants in Spain

Author

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  • Alberto Bayo-Moriones
  • Pedro Ortín-à ngel
Abstract
Analyzing data obtained from interviews at 653 Spanish industrial plants in 1997, the authors investigate factors affecting the choice between two ways of filling supervisory and skilled technician positions: internal promotion of blue-collar workers, and external recruitment. The use of internal promotion was positively correlated with efforts by plants to measure employees' skills, as well as with the specificity of blue-collar workers' human capital investment at the plant. Contrary to expectations, no evidence is found that the use or efficiency of other incentive systems, such as variable pay, had a significant influence on the degree to which internal promotion was used. The authors interpret their results as preliminary evidence that internal promotions are used to protect and favor specific investments, especially those made by firms to assess their workers' skills.

Suggested Citation

  • Alberto Bayo-Moriones & Pedro Ortín-à ngel, 2006. "Internal Promotion versus External Recruitment in Industrial Plants in Spain," ILR Review, Cornell University, ILR School, vol. 59(3), pages 451-470, April.
    • Handle: RePEc:sae:ilrrev:v:59:y:2006:i:3:p:451-470
    DOI: 10.1177/001979390605900307
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    References listed on IDEAS

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    Cited by:

    1. Kräkel, Matthias & Szech, Nora & von Bieberstein, Frauke, 2014. "Externalities in recruiting," Journal of Economic Behavior & Organization, Elsevier, vol. 107(PA), pages 123-135.
    2. Philipp Grunau & Marco Pecoraro, 2017. "Educational mismatch and promotions to managerial positions: a test of the career mobility theory," Applied Economics, Taylor & Francis Journals, vol. 49(12), pages 1226-1240, March.
    3. Mario Bossler & Philipp Grunau, 2020. "Asymmetric information in external versus internal promotions," Empirical Economics, Springer, vol. 59(6), pages 2977-2998, December.
    4. Jed DeVaro, 2020. "Internal hiring or external recruitment?," IZA World of Labor, Institute of Labor Economics (IZA), pages 237-237, May.
    5. Timothy N. Bondtn, 2017. "Internal Labor Markets in Equilibrium," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 33(1), pages 28-67.
    6. Mihailo Radoman & Marcel C. Voia, 2022. "Internal promotion and the Bosman ruling: Evidence from the English Premier League," LABOUR, CEIS, vol. 36(4), pages 445-470, December.
    7. Uschi Backes-Gellner & Simone N. Tuor, 2010. "Avoiding Labor Shortages by Employer Signaling: On the Importance of Good Work Climate and Labor Relations," ILR Review, Cornell University, ILR School, vol. 63(2), pages 271-286, January.
    8. Bertheau, Antoine, 2021. "Employer Search Behavior: Reasons for Internal Hiring," Labour Economics, Elsevier, vol. 73(C).
    9. Rocio Bonet, 2014. "High-Involvement Work Practices and the Opportunities for Promotion in the Organization," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 53(2), pages 295-324, April.
    10. Mihailo Radoman & Marcel-Cristian Voia, 2015. "Internal Promotion in Competitive Sports: Evidence from the English Premier League," Carleton Economic Papers 15-09, Carleton University, Department of Economics.
    11. Mañé Vernet, Ferran & Benner, Chris, 2009. "Dead-End Jobs or Career Opportunities? Advancement opportunities in call centers," Working Papers 2072/42870, Universitat Rovira i Virgili, Department of Economics.
    12. Jed DeVaro & Antti Kauhanen & Nelli Valmari, 2019. "Internal and External Hiring," ILR Review, Cornell University, ILR School, vol. 72(4), pages 981-1008, August.
    13. Gregoric, Aleksandra & Kato, Takao & Larsen, Casper B.L., 2024. "Internal Promotion or External Hire? Staffing Management Positions When Employees Have a Seat in the Boardroom," IZA Discussion Papers 17304, Institute of Labor Economics (IZA).
    14. Jed DeVaro & Hodaka Morita, 2013. "Internal Promotion and External Recruitment: A Theoretical and Empirical Analysis," Journal of Labor Economics, University of Chicago Press, vol. 31(2), pages 227-269.

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