The local ‘war for talent’ – recruitment of recent tertiary education graduates from a regional perspective: some evidence from the German case

Abstract

We analyse recruitment of recent tertiary education graduates drawing on a rich set of interviews with human resource managers of 46 large- and medium-sized firms in different regions across Germany. Specifically, we address the question of which higher education institutions' managers choose for campus recruiting and which criteria managers use to select recruitment institutions. We find that a substantial share of institutions is located close to the firm seeking to recruit and that the major criterion for selection is geographic proximity to campus. Notably, quality- and performance-related criteria are hardly mentioned. This result is robust for firms in different regional settings, of different size and popularity. We further elaborate on the reasons behind this finding and conclude that the firms' regional orientation is driven by the interplay between three major factors: enhancing recruitment success and retention probability of graduates, avoiding competition with other employers and dealing with imperfect information.

Keywords:

• recruitment
• graduates
• region

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1. We refer to the wider group HEIs in Germany that include research and technical universities, university clinics, universities of applied sciences, theological and pedagogical universities and universities of music and arts (destatis (German Federal Statistical Office) 2013).

2. In Germany, we find 108 research universities (destatis (German Federal Statistical Office) 2013) that – in contrast to universities of applied sciences – may confer doctorates and the postdoctoral qualification to teach in higher education (Habilitation). Universities typically cover a broad range of academic fields whereas universities of applied sciences are more specialized.

3. www.hochschulkompass.de (1 February 2012).

4. In the interviews, we asked managers to what extent selection of recruitment universities is made on site. Forty-two managers (including 24 headquarter locations) answered in the affirmative. For four firms, we had negative replies or inconclusive answers. These four firms (RS13, MS6, MS13 and MG7) were excluded from analysis to make sure that at the remaining ones managers are free to set their own personnel strategies and define selection criteria for recruitment universities on their own.

5. This is due to structural economic differences between the regions. For example, firms RS9 and RS10 are among the 30 largest employers in the selected rural and shrinking region although they have a comparably small number of employees (170 and 120). Conversely, firm MG2 with 750 employees is only ranked 28th in the metropolitan and growing region. Further, differences in response rates cause differences in firm size in our sample: in region RG, for example, most of the larger firms replied positively to an interview request (the smallest firm RG10 was ranked 17th in the list), whereas in region RS, larger firms from the list were more likely to refuse our request. Accordingly, for our analysis, we compare firms by size. Size is measured by that of the firm's location where we conducted the interview. We admit that besides the number of employees at a single location, size of the firm as a corporation may play an important role. However, in this context, size of a corporation may serve as a proxy for popularity rather than application probability since graduates typically apply to firms in specific locations. Popularity of a firm is assessed independently.

6. We admit that the ranking reveals popularity of firms that may be groups or corporations and does not relate to single branches of a firm. Thus, we do not know whether one branch or location is as popular as the whole firm. In turn, it may be that one subsidiary indeed is a popular employer in a specific region, even if it is not listed in the survey.

7. It is worth mentioning that managers refer to a wider geographic radius as borders of mobility that reflect cultural boundaries in Germany, North–South Divide in particular. This finding is to some extent supported by graduate studies. Davies, Greenwood, and Li (2001) for example show that regional mobility of graduates decreases with absolute distance between origin and destination. Apparently, graduates prefer to stay close to regions they are socially linked to, even if they take up a job elsewhere. Falck et al. (2012) use differences in German historical dialect boundaries to demonstrate that cultural differences between regions hinder spatial mobility of graduates. This result is backed up by Buenstorf, Krabel, and Geissler (2014).

8. These examples of ‘local patriotism’ certainly are extreme ones. Specifically, we talk about enterprises that present themselves as traditionally regional firms. Notably, those are not small and medium-sized enterprises (e.g., RG7), nor exclusively located in rural regions (e.g., MG4).

9. According to the respondent, the term ‘key university’ conceptually derives from customer marketing, where key account management is of major importance. ‘Key accounts’, as McDonald, Millman, and Rogers (1997) explain, ‘are customers in a business-to-business market identified by selling companies as of strategic importance’ (McDonald, Millman, and Rogers 1997, 737). The concept of key universities is to some extent similar. In university marketing, a business-to-university relationship is established, in which key universities are of strategic importance to a company with regard to recruiting.

10. There are some examples where firms indeed choose a highly reputed (technical) university. Still, typically these universities are located close to the firm. Apparently, reputation of a university is not a criterion per se but is combined with geographic proximity (choosing so-called ‘local champions’, MS12).

11. Similarly, Rynes and Boudreau (1986, 752) report that ‘most recruiting directors appear not to compile the necessary data’ and that ‘studies linking recruiting practices to post-hire outcomes appear to be primarily academic phenomena’ (Rynes and Boudreau 1986, 745).

Additional information

Funding

This work was supported by the German Federal Ministry of Education and Research (Bundesministerium für Bildung und Forschung, BMBF) [01PW11002].