LinkedIn is a very useful tool which I’ve used for several years. It has become essential for job seekers and for finding out more about people that you do business with. Since you can use most of the services free I shouldn’t really complain about it. But there is one innovation that I think is pointless and which causes quite a lot of irritating traffice: endorsements.
Economists are of course grumpy and cynical, so my view is definitely not shared by many other people, including some recruitment professionals. (I use the word professional in its narrow sense of “doing something for money”). LinkedIn invites, well, urges you to endorse your contacts for various skills they supposedly have. The result is that some profiles now have a very long list of skills, endorsed by various people. And we are forever being asked if we want to add skills or endorse other people’s.
Those with multiple skills who have only three years of work experience should ask themselves if it’s credible to claim so much expertise. Somebody with skills in ten different areas of finance might be signalling that they have superficial knowledge in each of them. Seasoned finance employers (who are also grumpy and cynical) will almost certainly ignore it all in any case. They know what to expect of an Associate level employee and will be more impressed by academic qualifications and evidence of specific transaction or client experience – which should be in the profile of course.
The goal of the endorsement is sensible – to overcome asymmetric information. Economists spend a lot of time (maybe too much) thinking about asymmetric information, which is all pervasive in economic and social life. Tom says he’s good at something. How does Lucy know whether Tom is telling the truth (or even if he’s truthful, is he as good as he thinks he is?). There are two ways of overcoming this lack of information. Either Tom displays a credible qualification such as degree, professional certificate or association with a credible employer. Or he gets other people to attest to his skills, in other words he gets a reference.
References are of course an ancient way of verifying a person’s claims to skills and qualities that a prospective employer is interested in. But there is a good reason why references are usually confidential. Only if the referee is able to be candid is he or she likely to be objective (and not necessarily even then). Endorsements are public references and suffer from the lack of credibility that non-private communication entails. Economists refer to something called “cheap talk” meaning that it’s easy for someone to boast about their own skills or promise to do something. For the claims to be believed they must be backed by incentives (I will pay a price if I fail to fulfil my promise) or by reputation. Those who have a reputation worth having will be naturally careful about nurturing it and not providing too many endorsements for fear that they lose their credibility.
This is a little self serving because I don’t want to have to provide hundreds of endorsements to people of whom I do have some useful knowledge. I have made clear to students in the past that I never provide endorsements, though I usually provide private references when requested. If I endorsed one or two people I would open the floodgates to many more, by which time the value of my endorsement would have shrunk to very little. So there are only two equilibria – no endorsements or universal endorsements. The first is much less work, so that’s the one I choose.