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Social Networks and Employee Performance in a Call Center1

Much research in sociology and labor economics studies proxies for productivity; consequently, little is known about the relationship between personal contacts and worker performance. This study addresses, for the first time, the role of referral contacts on workers’ performance. Using employees’ hiring and performance data in a call center, the author examines the performance implications over time of hiring new workers via employee referrals. When assessing whether referrals are more productive than nonreferrals, the author also considers the relationship between employee productivity and turnover. This study finds that referrals are initially more productive than nonreferrals, but longitudinal analyses emphasize posthire social processes among socially connected employees. This article demonstrates that the effect of referral ties continues beyond the hiring process, having long‐term effects on employee attachment to the firm and on performance.