Competition between employed and unemployed job applicants: Swedish evidence

We use the Swedish Job Applicant Database to empirically investigate whether being unemployed per se reduces the probability to get contacted by a firm. This database contains personal characteristics and preferences over the type of job the applicant wants to find. The data is submitted both by employed and unemployed workers over the Internet by the applicants themselves. This means that we have access to exactly the same information as firms have when they choose whom to contact. Our results show that an unemployed applicant faces a lower probability to get contacted by a firm than an otherwise identical employed applicant, thus supporting the claim that firms view employment status as an important signal for productivity.