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IW-Trends No. 3 23. September 2024 Helena Bach / Carolin Denise Fulda Collectively Agreed Wages as an Instrument for Recruiting Skilled Labour?: Results of a Selection Experiment Examining how Job Applicants Decide

Companies are increasingly focussing their attention on the recruitment of skilled workers and thus facing the growing challenge of making their job advertisements as attractive as possible.

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Results of a Selection Experiment Examining how Job Applicants Decide
IW-Trends No. 3 23. September 2024 Helena Bach / Carolin Denise Fulda

Collectively Agreed Wages as an Instrument for Recruiting Skilled Labour?: Results of a Selection Experiment Examining how Job Applicants Decide

Helena Bach / Carolin Denise Fulda German Economic Institute (IW) German Economic Institute (IW)

Companies are increasingly focussing their attention on the recruitment of skilled workers and thus facing the growing challenge of making their job advertisements as attractive as possible.

Since the public debate often links collective bargaining agreements with good working conditions, it is natural to ask whether enterprises bound by collective agreements can use the resulting pay levels as an advertising advantage. To answer this question, the authors investigated whether a reference to collectively agreed wages could be used in job advertisements to persuade potential employees to apply. Based on a survey and an integrated selection experiment with 2,114 participants, the study particularly examines the influence of collectively agreed wages on the decision to respond to a job advertisement. The results show that despite the predominantly positive associations between collective bargaining agreements and an employer's salary structure, potential applicants are no more motivated by collectively agreed wages than by fair market wages or performance-based wages. Only a reference to pay above the collectively agreed sectoral standard can make a job advertisement stand out. Moreover, the study makes clear that, in addition to salary, other factors such as arrangements for working from home and fixed-term contracts can determine whether or not an application is sent.

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Results of a Selection Experiment Examining how Job Applicants Decide
IW-Trends No. 3 23. September 2024 Helena Bach / Carolin Denise Fulda

Collectively Agreed Wages as an Instrument for Recruiting Skilled Labour?: Results of a Selection Experiment Examining how Job Applicants Decide

Helena Bach / Carolin Denise Fulda German Economic Institute (IW) German Economic Institute (IW)

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The Minimum Wage as a Means of Combating Income Poverty
IW-Trends No. 1 28. March 2026 Lennart Eckle / Christoph Schröder

The Minimum Wage as a Means of Combating Income Poverty

Although raising Germany’s minimum wage to12 Euro in October 2022 had a noticeable effect on wage distribution, the effect on income poverty remained minimal.

Lennart Eckle / Christoph Schröder IW

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IW-Trends No. 4 23. December 2025 Hagen Lesch

Germany´s Changing Industrial Relations: A Comparison with Other OECD Countries

The extent of industrial action in Germany – the number of working days lost due to strikes and lockouts - has increased significantly, albeit from a low base.

Hagen Lesch IW

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