Strength of Social Ties in Local Labour Market of Kolkata

Abstract

In a world where labour market participants are not anonymous, social networks often play a major part in shaping labour market outcomes. Labour economists have long recognized that social networks play a very important role in shaping labour markets outcomes. Job-seekers often use their personal contacts to get employment-related information or job referrals. This paper provides an example, where workers use social ties to exchange employment information, in the context of the urban formal labour market in Kolkata. Workers are mainly employed in the healthcare sector, IT sector, data analysts, and in other service sectors, including banking sector, education (non-teaching) of Kolkata. The paper finds that a significant percentage of the workers irrespective of their age and gender, hears about the job vacancy through personal connections. This paper further finds that friendship ties are mainly used for searching jobs. Most of the workers hear about the job vacancies from their friends or acquaintances. The paper also finds that a worker, who is a newcomer in the labour market, is likely to get information through one of his direct ties rather than indirect ties. However, indirect ties are important for the workers who change their companies on a regular interval. Moreover, workers hear about employment information from both strong ties and weak ties. The paper also finds the empirical support of evolution of a triad.