Recruitment by Exporters: Implications for Labour Demand Concentration and Labour Market Matching

ABSTRACT Leading up to Slovenia's entry into the EU, Slovenian exporters experienced large reductions in tariffs with their main trading partners, the EU member countries. We exploit variation in exports during this period to examine the role of exporting in the firms' recruiting practices. Data on all job vacancies and new hires in Slovenia during the 5 years preceding EU entry reveal that exporters created, on average, 30% of all vacancies and recruited 33% of new hires annually, despite comprising only 6% of all firms and 13% of all recruiting firms. Incumbent exporters were responsible for most recruiting. These differences in recruitment at the intensive and extensive margins had broader labour market implications. We find that labour markets with a larger presence of exporters had a more concentrated labour demand and, consistent with reduced coordination frictions, showed some signs of better matching of workers to job vacancies.