Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/318493 
Year of Publication: 
2025
Series/Report no.: 
WIFO Working Papers No. 696
Publisher: 
Austrian Institute of Economic Research (WIFO), Vienna
Abstract: 
Using a unique combination of Austrian administrative data, we show that start-ups' search and hiring decisions matter for their business success. Firms that report vacancies to the Public Employment Service in the early stage of their existence stay longer in the market and grow stronger. Moreover, while hiring the unemployed can benefit startups, the timing is crucial. Hiring within the first six months increases exit risk, whereas hiring in the second half-year reduces it. This is probably due to the nature of the positions filled. Key management positions, often filled early, seem to be better suited for other employees. Conversely, once the management team is in place, hiring the unemployed for "regular" positions fosters survival and growth. This pattern holds for different subgroups of the unemployed. Evidence of learning effects suggests that positive experiences with early PES involvement and unemployed hires encourage continued use of these practices later on.
Subjects: 
Startups
Recruitment
Vacancy Posting
Hiring
Unemployed
Public Employment Service
Survival
JEL: 
D22
J21
J23
J63
J71
M13
M51
Document Type: 
Working Paper

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