Mismatch unemployment and local labour market eficiency: the role of employer and vacancy characteristics.

Much of the theoretical and policy debate on local labour markets has focused uponimproving the educational, training, and other `supply-side' characteristics of job seekers. However,complementary employer `demand-side' factors, in particular the characteristics of employers, jobopenings, and recruitment practices, are also important in local labour markets but have beenrelatively neglected in the literature. The authors investigate such factors and argue that job vacanciesin an environment of high unemployment are not only the result of traditional `structural' or `skillmismatch' between local labour markets, but may result from a mismatch between employer and job-seeker expectations combined with an asymmetry of information between these groups, resulting in`frictional mismatch' within local labour markets. Skill shortages can therefore be seen as a subset ofwider recruitment difficulties. The authors survey a sample of employers to examine their character-istics, vacancies, and recruitment practices. The results provide evidence on the importance ofemployer and job factors on the flow of people into job vacancies. They also indicate that certainrecruitment practices and inherent characteristics of vacancies and employers result in job offers thatare either unattractive or inaccessible to the unemployed and hence increase the duration of jobvacancies. It is argued that research into and design of local labour-market policies need to take moreexplicit account of the employer and job characteristics when discussing skill mismatc