So, Do More Applicants Produce Better Hires?

The central question of this series has a conditional answer. In the Austrian vacancy-level evidence, more applicants help on the employer’s search and match margins: vacancies fill faster, and the workers hired stay longer in a pattern consistent with better worker-firm fit. But the same applicant abundance lowers discretionary starting pay and lets firms reinforce existing gender and nationality patterns. Whether the hire is “better” therefore depends on the outcome being optimized, who receives the new options, and how much weight is placed on efficiency, worker surplus, and access.

That conclusion is more useful than a yes-or-no slogan because applicant supply is not one intervention with one consequence. It changes the environment in which the hiring decision is made. A fuller pool raises the flow of candidates, the value of continued search, and the employer’s ability to reject a candidate who falls below its preferred threshold. Those changes travel together into the speed of filling, the durability of the match, the starting wage, and the composition of the workforce. The important fact is not that one of these outcomes exists. It is that they are connected by the same shift in who has options.

A larger pool changes the whole bargain

The speed and tenure results form the strongest affirmative part of the answer. In the study’s IV estimates, one additional first-week observed application reduces vacancy duration by about 0.90% and raises job duration by about 2.14%. Scaled to a one-standard-deviation increase of roughly 6.9 applications, the vacancy becomes about 6.1% shorter—roughly three days against a 51-day average—and the subsequent job lasts about 14.7% longer, approximately two months against a 14-month average.

Those estimates should not be read as two unrelated efficiency statistics. Together they fit the mechanism developed earlier. More applicants increase the chance that a suitable candidate appears while the vacancy is still open. The firm can also be more selective because rejecting one candidate no longer carries the same fear that no one else will arrive. If that combination works as the model predicts, the employer reaches a credible fit sooner and the resulting relationship is less likely to dissolve in the early months.

The timing of the duration effect supports that interpretation. The clearest reduction in the probability that a vacancy remains open occurs in weeks five through eight, when about half of vacancies still need to be filled. That is when scarcity becomes a binding constraint for a vacancy that has not closed. The applicant pool is not simply making every administrative step faster from the moment an advertisement appears; it is changing the choice at the point where continued search and acceptance become consequential alternatives.

The tenure result is also carefully qualified. Longer employment spells are consistent with better matching because poor fit often reveals itself early, and the estimated survival improvement is largest in the first months after hiring rather than widening throughout the spell. That pattern is less consistent with the alternative explanation that displaced workers stay longer merely because their outside options are weak. Yet tenure remains an indirect outcome. It does not observe productivity, satisfaction, or every reason a worker remains employed. The evidence supports “consistent with better matching,” not “proves a more productive hire.”

This distinction is central to the title. If “better” means that an employer wants a vacancy closed and a new worker to remain, the evidence points in a favorable direction for the applicant-supply margin identified in the study. A larger pool can make the firm both faster and more selective. But the result is not that the firm obtains an unambiguous improvement at no cost.