Publications
Publications
- 2021
- HBS Working Paper Series
Flight to Safety: How Economic Downturns Affect Talent Flows to Startups
By: Shai Benjamin Bernstein, Richard Townsend and Ting Xu
Abstract
Using proprietary data from AngelList Talent, we study how individuals’ job search and application behavior changed during the COVID-19 downturn. We find that job seekers shifted their searches toward more established firms and away from early-stage startups, even within the same individual over time. Simultaneously, they broadened their other search parameters. Relative to more established firms, early-stage startups experienced a decline in applications, primarily driven by higher quality candidates. These declines hold within a firm as well as within a job posting over time. Our findings uncover a flight to safety channel in the labor market, which may amplify the pro-cyclical nature of entrepreneurial activities.
Keywords
Startup Labor Market; Flight To Safety; COVID-19; Recession; Business Startups; Human Capital; Business Cycles; Health Pandemics
Citation
Bernstein, Shai Benjamin, Richard Townsend, and Ting Xu. "Flight to Safety: How Economic Downturns Affect Talent Flows to Startups." Harvard Business School Working Paper, No. 21-045, September 2020. (Revised May 2021.)
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