Search Intensity vs Search Efficiency Divergence
RCTReview
Active labor market policies frequently attempt to solve unemployment by encouraging job-seekers to increase search effort, failing to recognize that increasing search volume yields no return if application conversion rates remain low.
Picture this
Search intensity measures how many applications an individual submits, whereas search efficiency measures how many job offers result per application. Lowering travel costs prompts job-seekers to knock on more doors without changing their success rate, whereas providing verified skill credentials improves offer conversion per door knocked without requiring additional travel.
What the evidence says
Transport subsidies increased search probability by 12.5% and vacancy board visits by 9 percentage points without altering long-term outcomes; the application workshop left search intensity unchanged but improved permanent offer conversion from 1 offer per 7.2 applications in the control group to 1 per 5.2 applications (p < 0.10).
- Who was studied
- N = 3,052 young job-seekers tracked via fortnightly high-frequency phone panel surveys in Addis Ababa, Ethiopia.
- How
- High-frequency phone panel tracking measuring fortnightly search steps, vacancy board visits, application volume, and offer conversion rates across experimental arms.
What to do
Distinguish search volume metrics from application-to-offer conversion rates when evaluating whether labor market constraints stem from spatial search costs or information asymmetries.
From the source
"The job application workshop, on the other hand, does not affect the likelihood of searching for a job or the number of job applications sent... Indeed, in Table A.18 we show that the workshop improves the conversion rates of job applications to job offers..."
Anonymity_or_Distance_Job_Search_and_Labour_Market_Exclusion_in.pdf