Hiring Discrimination in Racially Diverse Labour Markets:A Cross Country Study

Abstract: The goal of this thesis is to determine if hiring managers are sensitive to racial background ofapplicants during hiring process. The author determined hiring discrimination using twoperspectives, first what did the hiring managers know about hiring discrimination? Second,correspondence testing was conducted to quantitatively determine if employers discriminateagainst certain names during resume screening. A cross country study was done betweenSweden and Canada. The results revealed that hiring managers in both countries are wellaware of negative impact of hiring discrimination on a firm or an organisation and all therespondents condemned it. However, correspondence testing showed that hiringdiscriminations occur in both countries. 1009 jobs were applied in Sweden while 1326 jobswere applied in Canada. The aggregate results for Sweden shows that applicants with foreignnames receive a call back rate of 66.3% while applicants with Swedish names receive a callback rate of 77.2%. The results for Canada show that applicants with foreign names receiveda call back rate of 73.5% while applicants with English names receive a call back rate of74.6%. Probit estimation was used to estimate the probability of applicants being invited forinterview. The results indicate that hiring discrimination against foreign names is morepronounced in Sweden compared to Canada.