INFORMAL SEARCH AND JOB OPPORTUNITIES AMONG SECONDARY-SCHOOL LEAVERS IN HUNGARY* Tamás BARTUS Department of Sociology and Social Policy, Budapest University of Economic Sciences and PA Budapest, Fõvám tér 8. H-1093; e-mail: tamas.bartus@bkae.hu Abstract: This paper addresses two questions: (1) Do informal job searchers find good jobs in Hungary? (2) Do social resources theory and the theory of employee referrals explain the conditions under which informal job searchers find good jobs? The questions are examined using a rather unique dataset which was collected among people who completed secondary vocational education in 1998. It is found that the use of informal methods in itself rarely promotes one’s chances of finding a good job. Rather, good jobs can be accessed through either high status contacts or employee referrals. These findings are consistent with both social resources theory and the theory of employee referrals. Keywords: social networks, labor market, social resources theory INTRODUCTION This paper examines whether friends and relatives help job seekers to get a good job in Hungary. Using the rather general idea of path-dependence (David 1985; Arthur 1988; North 1990), it has been argued that personal contacts become even more important during the transition from communism to capitalism (Sik 1994; see also Czakó and Sík 1994, 1995). Although there is evidence documenting the extensive use of personal contacts in recruitment (Csegény et al. 1996; Laki 1997; Laki [unpublished]), there are no studies examining the effects of personal contacts on labor market outcomes (for a study before the transition, see Böröcz and Southworth 1998). Our aim is to answer two research questions. The first question is whether job searchers are more likely to find good jobs with the help of informal intermediaries 1417-8648/$ 20.00 © 2003 Akadémiai Kiadó, Budapest Review of Sociology Vol. 9 (2003) 2, 5–26 STUDIES * This paper summarizes some of the results contained in my PhD dissertation Social Capital and Earnings Inequalities. The Role of Informal Job Search in Hungary. The thesis work was supervised by Jules Peschar, Tom Snijders (both associated with the University of Groningen) and Beate Völker (University of Utrecht) whose support is acknowledged. Helpful comments were received from Peter M. Marsden, Róbert Tardos, Endre Sík and János Köllõ. The data collection was financially supported by the Department of Sociology at the University of Groningen.