Beyond College For All: Career Paths for the Forgotten Half

Chapter 9. Pathways into Work: Short- and Long-Term Effects of Personal and Institutional Ties

193 Chapter 9 Pathways into Work: Short- and Long-Term Effects of Personal and Institutional Ties T he central focus of this book has been to understand why students face great difficulties in gaining recognition of their value in the labor market.1 New high school graduates have difficulty getting jobs that offer better pay or advancement, and their jobs and pay tend to be unrelated to their school achievements (Bills 1992; Crain 1984; Parcel 1987; Grubb 1992; Jencks et al. 1979, 117; Stern et al. 1995). These outcomes are not well explained by economic or sociological theories. For instance, human capital theory predicts that new high school graduates with higher achievement will get better jobs and pay, but that prediction is clearly contradicted by research (Griffin et al. 1981; Murnane et al. 1995; Gamoran 1994; Miller 1998). Sociological theories suggest that the problem resides in the labor market structure: the labor market is stratified and youth are confined to low-strata jobs that offer poor stability, low pay, and little advancement—in other words, the secondary labor market (Doeringer and Piore 1971). Stratified labor market theory explains these findings, but it overexplains youths’ difficulties. It has two problems: it does not explain why some youth escape the secondary labor market at the outset, or why many individuals eventually are able to escape it later (Granovetter 1974/1995). In response to the failures of traditional economic and sociological theories (Althauser and Kalleberg 1981; Dore 1983; Williamson 1975), new theories have arisen in both fields. The new institutional economics considers the efficiencies of institutional relationships, and it calls for studies of actors and social contexts (Lazear 1979; Rosen 1982). Similarly, new sociological models contend that markets often “depend on the nature of personal relations and the network of rela- 194 Beyond College for All tions between and within firms” (Granovetter 1985, 502). Instead of assuming that information is always used and trusted, these models describe some ways in which information is given meaning through social contacts. “People prefer to deal with individuals of known reputation , or, even better, with individuals they have dealt with before, social relations . . . are mainly responsible for the production of trust in economic life” (Granovetter 1985, 490–91). Some of our employers indicate that job contacts help them assess young job applicants (chapter 6), but our sample cannot say how many and which kinds of students would be affected. Job contacts might explain how some youth can evade the ordinary obstacles of the labor market structure and get jobs that lead to better immediate pay and to better career trajectories that increase their earnings over time. This chapter examines whether different kinds of youths use different ways to contact employers, and whether youths’ ways of contacting employers affect their earnings right after high school and nine years later. Besides examining the effects of two kinds of personal contacts (relatives and friends), it also explores the influence of two kinds of institutional contacts (school job placement and employment services), which have rarely been considered in previous research . Contact Influences: Personal Versus Institutional Contacts In recent years, there has been increasing interest in the influence of social contacts on labor market outcomes. Granovetter’s (1973) early study showed how the job search process is facilitated by personal ties, particularly weak ties (for example, casual acquaintances); these provide wide sources of information about jobs, from which the job seeker can choose the best. However, Granovetter’s sample consisted of experienced, well-educated workers, and subsequent research has suggested that weak personal ties are “of most advantage to those higher up and least to those at the bottom” (Granovetter 1974/1995, 150; Lin, Ensel, and Vaughn 1981). For less-educated, inexperienced workers, weak personal ties may be less effective (Ericksen and Yancey 1980; Wegener 1991). Moreover, there is an additional concern that “cross-sectional analyses may miss the role of personal contacts in building a career” (Granovetter 1974/1995, 149). Granovetter suggests that early contacts may have a greater impact on later jobs than on early jobs. This might occur because of the accumulation of advantages that comes from initial contacts: good initial contacts lead to more and better sub- Pathways into Work 195 sequent contacts. Alternatively, it might occur as the result of career ladders: youth with good contacts get early jobs that lead to better future career advancement, even though these jobs pay no better than others...