The labor market is characterized by information asymmetry between employers and potential employees. Employers attempt to reduce this asymmetry by relying on various signals to infer an applicant’s competence and commitment. Using detailed administrative hiring records for entry-level employment in the nonprofit sector, I find evidence that Black job seekers who signal learning about an opening through online job boards experience poorer returns than Black job seekers who signal alternative non-networked recruitment channels (e.g., visiting a company’s website to learn about new employment opportunities). Analysis of job seekers’ resume data suggests that employers and Black job seekers face a double bind: online job boards attract highly qualified Black candidates, yet because these candidates are predicted to be more competent than others in the applicant pool, employers prioritize organizational fit when making callback decisions. The findings highlight how employers differentiate among non-networked recruitment channels and between racial groups in settings with weak employee-referral networks. The findings also rule in online job boards, a ubiquitous feature of contemporary labor markets, as a potential source of lower labor market returns for Black job seekers.
