Being popular pays: Why workers who find jobs through friends earn more

Jessica Morris
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Well-connected people earn around six per cent more (Source: Getty)

Developing new skills, taking on an ambitious project or studying for a qualification around work hours are tried and tested ways of boosting your pay check.

But new research suggests the secret to landing a higher paid job is a good circle of friends, both inside and outside of the workplace.

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That's according Federal Reserve Bank of St. Louis economist David Wiczer who found jobs obtained through referrals generally pay around six per cent more, compared to those secured by applying to a firm directly.

Those who clinched their job this way earned an average weekly salary of $772.20 (£587.65), or roughly $40,000 per year. But those who didn't had an average weekly salary of $725.84, or nearly $38,000 per year.

It's generally thought that this is because job opportunities found through a friend have an informational advantage, for example more is known about how well-matched an individual is to their prospective employer.

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But Wiczer said another explanation for this is that candidates with wider friendship circles also have access to better jobs.

"Workers who tended to find jobs through their network were different than those who found jobs through direct search, and the better-connected workers had access to better jobs," he said.

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