Social Networks and Labor Market Outcomes: Occupation Matters

Giovanna d’Adda, Jessica Gagete Miranda and Giovanni Righetto

No 2025-02, FBK-IRVAPP Working Papers from Research Institute for the Evaluation of Public Policies (IRVAPP), Bruno Kessler Foundation

Abstract: We study how the influence of social networks on individual labor market outcomes varies across occupations, specifically between manual and cognitive jobs. Using data from over fourteen million Brazilian workers and exploiting exogenous job termination due to mass layoffs, we confirm that social networks reduce unemployment duration and increase wages in the new job, but show that these effects are heterogeneous depending on workers’ occupations at the time of displacement. Manual workers benefit more from networks in terms of job reentry but less in terms of wages compared to workers performing cognitive tasks. We argue that these different patterns are due to the fact that networks reduce the likelihood that manual workers find new jobs in the same occupation, given that occupational change is associated with reductions in wages.

Keywords: Social networks; Labor Market Outcomes; Mass-Layoff; Brazil (search for similar items in EconPapers)
JEL-codes: J01 J24 J62 (search for similar items in EconPapers)
Date: 2025-04
New Economics Papers: this item is included in nep-hrm, nep-lab, nep-net and nep-soc
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Persistent link: https://EconPapers.repec.org/RePEc:fbk:wpaper:2025-02

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