Several studies establish that employers select applicants on the basis of skills obtained through education, which are reflected in their qualifications; this relationship, however, is far from clear. Proponents of human capital theory argue that employers prefer candidates with high education levels, who are believed to possess more productive skills (Becker, 1993; Bowman, 1966; Mincer, 1989; Schultz, 1961). In comparison, other scholars (Bowles et al., 2001; Morgeson et al., 2005) argue that firms emphasise effort, personality, and identification when evaluating potential employees.

The present paper focuses on human capital and incentive-enhancing theories from which specific indicators are obtained. Both theories have different competing perspectives on the indicators that employers rely on during selection; therefore, they also have competing perspectives on the contribution of education to job attainment and inequality.

Human capital is based on the belief that learning and skills obtained within and outside the classroom have the same productive value as the other forms of capital (Lucas, 1988). It is argued that when human capital and skills are utilised optimally, employers, employees, and the society at large will profit (Schultz, 1961). Further, education prepares people for the labour market by increasing their productive skills. According to the human capital theory, employers are interested in skills that contribute to job performance and, thus, a firm’s success

The incentive-enhancing preferences theory, on the other hand, emphasises personality and effort. According to this theory education provides students with work habits that facilitate the organizational functioning. The internalised norms of behaviour of highly educated people result in greater worker initiative; thus, education socialises students for the labour market. Family background and social class provide the differentials in education socialisation, rather than cognitive capacities.

With human capital and incentive-enhancing theories as reference points, this paper focuses on the first selection round of applicants by analysing the indicators that employers derive from application letters and résumés. These indicators from the pre-screening round have rarely been studied in the context of hiring and inequality. Therefore, understanding these indicators in the context of the pre-screening round contributes to the understanding of applicant selection and the sociological and economical labour market theories. Thus, the paper focuses on indicators related to human capital, such as education level, field of study, and skills, and indicators tied to incentive-enhancing preferences like effort, personality, and identification.

The paper addresses the following research question: To what extent do the human capital and incentive-enhancing indicators contribute to the first selection round?

It aims to contribute to the debate on job attainment and inequality by focusing on indicators that the employer relies on during the selection of newly graduated students applying for junior managerial positions.

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