Org Perspectives On Starification

Organizational Perspectives on Stratification Author(s): James N. Baron Source: Annual Review of Sociology, Vol. 10 (1984), pp.
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Ann. Rev. Sociol. 1984. 10:37-69 Copyright ? 1984 by Annual Reviews Inc. All rights reserved
ORGANIZATIONAL PERSPECTIVESON STRATIFICATION

James N. Baron
of Sociology, Stanford Graduate School of Businessand Department University, Stanford, California 94305
Abstract
This essay reviews recent theory and research on organizations and social stratification,focusing on two dimensions of inequalitythat are affected by organizationsand theirenvironments:(a) how rewardsand opportunitiesvary as a functionof organizational attributes and (b) how enterprisesdiffer in their criteriafor matchingworkersand jobs. The effects of rewardstructuresand sortingprocesses on workers, organizationalperformance,and interorganizational relationsare also consideredbriefly. Since manyhypothesesaboutlabor marketsconcernlinks betweenorganizationsand socioeconomic achievement, researchto complementanalyses thereis a need for comparative organizational of career at the individualandaggregatelevels. Moreover,the interdependence outcomes within and among enterprises is widely recognized but requires explicit study. Futureresearchwill benefit immeasurablyfrom the development and testing of hypotheses about how organizationsand environments influence labor marketprocesses.
INTRODUCTION
and Many studentsof inequalityhave recentlychallengedthe statusattainment human capital approaches because of their exclusive focus on individual determinantsof career outcomes. Researchershave increasingly recognized that rewards are attached to organizationalpositions and that organizations differ systematicallyin their personnelpracticesand rewardsystems. Accordhas been revivifiedas an and stratification ingly, the link betweenorganizations area of researchinterest. The status attainmentand humancapital paradigms 37 0360-0572/84/0815-0037$02.00
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have been competentlyreviewed by others, as have specific strandsof newer "structuralist" approaches(Gordon 1972, Kalleberg& SOrensen1979, Baron & Bielby 1980, Featherman1981, Hodson & Kaufman 1982). However, a bases of inequalityis critical review of literature examiningthe organizational timely. Organizations impingeon careeroutcomes in two important ways. First, the division of labor among jobs and organizationsgenerates a distributionof opportunitiesand rewardsthat often antedates,both logically and temporally, the hiring of people to fill those jobs. Second, organizationalproceduresfor matching workersto jobs affect the distributionof rewardsand opportunities within and across firms and thus influence the likelihood of career success (Granovetter1981). This review consequentlyfocuses on these two aspects of stratification.The first section examines why some firms pay and promote more thanothers. After outliningtheoreticalcontroversiesaboutinternallabor markets, I will review analyses that link opportunitystructuresto specific facets of organizationsand theirenvironments.The second section focuses on differences in matchingworkersto jobs, describinghow career organizational dynamics depend on the organizationalsetting. A brief third section draws attentionto the impactthatstratification regimeshave on workersandorganizations. The concludingsection summarizesthis review and outlines its implications for future research.
OF INEQUALITY: THE ARCHITECTURE IN OPPORTUNITY VARIATION ORGANIZATIONAL REWARDS AND OrthodoxApproaches

research on organizationaldifferences in reward systems has Contemporary focused on the workings of internallabor markets.Neoclassical microeconomists, institutionalists,organizational sociologists, andneo-Marxistsacknowlhierarchiesof opportunityin determining edge the importanceof bureaucratic workers'achievements.While some careerladderscut across firms (Althauser & Kalleberg 1981), unequal access to avenues of advancementwithin organizations is a principal source of inequality (Spilerman 1977, Kalleberg & S6rensen 1979). Much of this researchreflects a dissatisfactionwith orthodoxeconomic and Orthodoxeconomic theoryrelates sociological theoriesof wage determination. wage differentials to variations in worker productivity and labor supply. human Employees are compensatedfor investmentsin productivity-enhancing capital. Sociological analyses of statusattainment processes, like humancapital research,typically embracesome variantof the functionaltheory of strati-
ORGANIZATIONS & STRATIFICATION 39 refersto an individualattribute, fication (Horan 1978). However, productivity whereas functionalismdifferentiateseconomic roles in terms of their societal importance.In other words, althoughfunctionalismand marginalproductivity theory both assume that rewardsequitably reflect the value associated with work, the functional theory of stratificationis a rudimentary"positional" perspective on inequality. It is not an organizationalperspective, however, thanindividualfirms that since accordingto this approach,it is societies rather encounterrecurringproblemsto be solved, therebygeneratinga distribution of power, privilege, and income (Lenski 1966, Treiman 1977).' Thus "positional"analyses of inequalitydo not necessarily contradictthe theories underpinningconventional individualistic studies of labor market achievement, nor can specific variables be neatly pigeonholed into those measuring "human capital" versus those reflecting "social structure."For example, investigators generally concur that education strongly affects socioeconomic attainment,butthey disagreeaboutthe natureof those effectsi.e. whether schooling increases worker productivity, trainability(Thurow 1972), culturalcapital (Collins 1979), or conformityto capitalistideology and organizationaldiscipline (Bowles & Gintis 1976:Chap. 5; Edwards 1976). Perspectiveson labor marketsdiffer most in their assumptionsabouthow and why organizationsstructurerewardsand match people to jobs-assumptions that often are not examined empirically (Baron& Bielby 1980). To reconcile of internallabor markets, stratificationresearchers competing interpretations must directly examine how particularorganizationaland environmentalattributes affect opportunitystructuresand the matchingprocess.
The Internal Labor Market: CompetingInterpretations

The origins and functions of internallabor marketshave been hotly debated. Many labor economists emphasize technical determinants,arguingthat technological progress increases workers' skill monopoly in the firm and that internal advancementopportunitiesare requiredso that senior workers will train junior personnel (Doeringer & Piore 1971). In his classic essay on bureaucracy,Weber (1947 [1922]) makes a similar argumentregardingthe efficiency of lifetime employmentand internaladvancementin largeorganizations, given societal trends toward rationalizationand specialization. constraintsthat favor internal Williamson (1975) emphasizes informational
an organizational 'Strategiccontingencytheoriesof powerrepresent counterpart to the functional theoryof stratification(e.g. Hickson et al 1971). It is hypothesizedthatorganizationalstanding reflects the extent to which workerscontrolcriticalresourcesdemandedby the firm, make unique membersto carryout theirduties. This contributions,and affect the ability of otherorganizational or "functionalimportance" means and providea perspectivemay help clarify what "productivity" clearer basis for relating specific organizationalcontributionsto rewards.
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promotionhierarchiesover perfectlycompetitivelabormarkets.He arguesthat perfect marketsfail because neither employers nor employees possess completely accurate informationabout present and future labor supplies and job requirements;because technical interdependenciesrequire harmony among workers;andbecause the bilateralmonopolyof employersandemployees over idiosyncraticjobs and skills, respectively, could lead to destructiveshort-run "opportunism" by both parties in the absence of long-termemploymentcontracts. Like accounts that emphasize the technological and bureaucratic efficiency of internallabormarkets,Williamson's frameworkneed not be viewed as a departurefrom neoclassical orthodoxy; an employer's investment in long-termcontracts is viewed as a rationalresponse to turnoverand training betweenmarginalproductivity costs, and any short-run disequilibria andwages should cancel out throughouta worker's career with the firm. Neo-Marxists, in contrast, regard internal labor markets as an effort by capitaliststo controla volatile workforce (Stone 1974, Marglin1974, Edwards 1979, Gordonet al 1982). Employersimpose gradedhierarchiesthat foster a docile "status"orientation and dissuade workers from utilizing the power labormarketsalso institutionalimplicit in theirskills (Wachtel 1974). Internal ize cleavages among workers along racial, sexual, and ethnic lines, thereby reducingthe likelihood of working-classcohesion. Otheranalysts emphasize organized labor's active role in formalizing and rationalizingemployment practices and promotion ladders;work place hierarchyis not forced on employees, they argue, but ratheris in their, as well as management's,collective interest (Douty 1963; Kahn 1976, 1980; Rubery 1978).2 Unfortunately,while researchon internallabor marketshas demonstrated the careerbenefits ensuing from them-and the distributionof these benefits across subgroupsin the laborforce-in generalit has not resolvedthe theoretical debatesaboutwhere andwhy promotionhierarchies andlong-termemployment contractsdevelop. Researchershave documentedthe impact of internal labormarketsin two differentways. First, lackingdataon personnelpractices, many researchershave attemptedto infer how internallabor marketsoperate fromdataon individualcareerpaths. Forexample, attainment researchers have attributedracial and sexual differences in the effects that schooling and first jobs have on careeroutcomes to the exclusion of women and minoritiesfrom & Hauser1978, Rumberger internallabormarkets(e.g. Featherman & Carnoy 1980, Sewell et al 1980; cf Rosenfeld 1980, Felmlee 1981).3 Although
2Some allege that craft unions, such as the longshoremen,have traditionallyopposed these arrangements,since workers resist any employer practice that subdivides jobs, dilutes union control over work assignments, or restrictspossibilities for changing employers (Finlay 1983). 3Sewell et al also found that social origins have a much stronger impact on occupational attainmentsamong men than among women, but they did not make the organizationalconnection there-that is, that class backgroundis importantin determiningwhethermen will advance up organizationalhierarchies.
ORGANIZATIONS& STRATIFICATION
41
these conclusions are both plausible and provocative, they demonstratethe difficulty of makinginferencesaboutinternallabormarketsfrom conventional attainment studies.4Differentialcareeroutcomesareattributed to organizational arrangementsthat are not examined. Even if internal labor markets are responsiblefor the observedinequalities,this researchdoes not illuminatehow or why this occurs. Second, otherinvestigatorshave analyzedcareerprocessesin theirorganizational setting directly, detailing the criteriathat employers use in structuring rewardsand opportunities.Unfortunately,this researchhas often been limited to specific work contexts. For example, careful and illuminating studies of stratificationregimes have been undertakenin virtually every type of firm, industry, and occupation imaginable (e.g. see Burawoy 1979, Kalleberg & SOrensen 1979). The cases and approaches employed in these studies, however, are so diverse as to limit their comparability.Concepts, methods, and findingsareunlikelyto be cumulativewithoutsystematiccomparative analyses that identify the crucial dimensions of organizations along which reward structuresand sorting processes vary. Fortunately, some research underway is designed with this objective in mind. Various groupsinterestedin personnelpolicies, such as the Conference Board, also conduct regular surveys of the employmentpractices that affect of this section, I will review recent andrewards.In the remainder opportunities studies that relate opportunitiesand rewardsto the specific attributesof organizations and their environment.
The Impact of Size

Organizationalresearchershave probablydevoted more attentionto the link between organizationalsize and work arrangements than to any other topic.5 Researchershave demonstrated,for example, that wages are higher both in industries made up of large companies (Masters 1969) and in the larger companies within any given industry(Lester 1967; but see Gordon & ThalLarsen 1969:Chap. 10). However, Granovetter (1984) argues that these relationshipsonly characterize manufacturing industries,which constitutean ever smaller share of the economy. Even the income of small business owners increases with employment size (Aldrich & Weiss 1981). The effects of schooling on income and status increase monotonically with the size of the workers(Stolzenemployee's work location for white, male, nonagricultural berg 1978).6 This finding may reflect the operationof internallabormarketsin
4Some studentsof attainmenthave also underscoredthe dangerof inferringcareer processes fromcross-sectionalretrospectivedata(e.g. Spilerman1977, Spenneret al 1982, Sorensen 1983). 5Indeed, S6rensen (1983) argues that in recent research most of the aspects of industrial structurethat are linked to earnings actually measure economic "bigness." 6Thispatternapparently does not hold for female workers(Kalleberget al 1981, Bielby & Baron 1983).
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large organizations,which use educationto screen employees for promotions; schooling may also be (or may be thought to be) more relevant to job tasks within largerorganizations.7 There is no straightforward,substantive interpretation,however, of the effects of size (Kimberly 1976).8 Perspectivesas diverse as neoclassical economics and neo-Marxism,can explain the impact of organizationalsize on opportunitiesand rewards. Large bureaucraciesmay pay and promote more because scale economies increase worker productivity, to which wages are of demandallows higherwages to be absorbedin tied, andbecausethe structure productpricing(see PhelpsBrown 1977:225-26). PhelpsBrownalso attributes the higher wages and opportunitiesin large firms to their urban locations, where greater rewards are necessary to offset competitors' offers and to compensateworkersfor longerjourneysto work. Alternatively,neo-Marxists arguethatlargeorganizationsaremorevulnerableto workerunrestandrewards are higher to reduce the chances of labor-management conflict. Simon (1957) andLydall(1959) have suggestedthateconomic rewardsdenoteorganizational andstatus-i.e. wage differentialsacrosspositionsreflectdifferences authority in organizational standing. Since large organizations have more layers of structure,one mightexpect an associationbetween scale and averagewages on these grounds as well. In other words, proponentsof competing approachesassume that size is a proxy for very different organizationalattributes.Consequently, it is worthwhile to examine covariates of size that might account for organizational differencesin opportunities and rewards,particularly since size is probablythe dimensionof organization most stronglyrelatedto all others(R. H. Hall 1982). The remainderof this section will review research on other organizational characteristicsthat may explain variationin labor marketoutcomes.
The Impact of Growth

cross-sectionalsize differencesas a reflectionof organiMany studiesinterpret zational development. A few researchers,however, have examined relations between organizationalchange and stratification directly. Rosenbaum(1979) studiedpromotionsamongwhite menbetween 1962 and 1972 in a Fortune500 corporationand found that corporategrowth increasespromotionrates. New
7Theemploymentadvantagesof workingin largeorganizations transcend time and place. Large companies were the first to implement "welfare work" in the early 1900s (Eilbert 1959), and Gitelman( 1966) documentsthe careerbenefitsof an internallabormarketin the mid 1800s. Wage and mobility differences across organizationsof varying size are pervasivenot only in the United States, but in other countries as well (Phelps Brown 1977:275;Gallie 1978; Cole 1979). 80perationalizing this variableis not straightforward either. Most researchersmeasuresize by establishmentemployment,butother levels of analysis and dimensionsof scale may be relevantto the relationshipbetween size and stratification.
ORGANIZATIONS & STRATIFICATION 43 opportunitiescreatedby growth "spill over" to groups that are otherwise less likely to advance-e.g. older, educated and younger, less-educated men. Bielby & Baron (1983) distinguishedthe effects of establishmentgrowth on employee tenure and promotionsfrom the impact of organizationalsize and with which growthis associated.Controllingfor size, locationaldifferentiation which increases tenureand promotionchances, they found thatorganizational growth between 1962 and 1967 improved chances for internalpromotions, among women. This result is consistentwith Rosenbaum'sasserparticularly tion that opportunities associated with growth extend to workers who are otherwiseless likely to be promoted(also see J. Pfeffer& J. Ross, unpublished work). While growth improves promotionchances, it does not necessarily imply equalization across organizational levels; rather it can exacerbate existing differences in promotionprobabilities(Stewman& Konda 1983). Moreover, Rosenbaum'sstudy does not growth has diminishingeffects on opportunity.9 include any years of organizationalcontraction(only diminishedgrowth), so one can only speculate about the applicability of his results to economic downturns.Yet, if growthbenefits those workerswhose careersare otherwise stalled, presumablythey are also the ones who are most affected by economic contraction. Seniority and "bumping"arrangements,for example, disproportionatelyharm women and minorities (Parker1981, Schervish 1983). In short, while growth undeniablycreates opportunities,it is unclear who benefits most fromthem. Job growthhas been greatestwithin small, new firms in so-called high technology industries,as well as in the service sector (Birch 1981). The latter has traditionallyprovided fewer career opportunitiesand benefits than the highly skilled, privilegedjobs in high technology industries thatare typically monopolizedby white men. As a result, growth may simply exacerbateinequalities.On the otherhand,otherresearchon equalopportunity programsindicates that growth has generally reduced barriersfor disadvanin female-intensiveindustries(Shaeffer& Lynton taged workers, particularly 1979, O'Farrell& Harlan 1984).
The Impact of Demography

Individuals'careers are not independent,as they are assumed to be in attainment research,but are inextricablytied to the fate of organizationalsuperiors, cohortandits relation subordinates,andpeers. The size of one's organizational to othercohorts significantlyaffects careeroutcomes (Pfeffer 1983); members of small cohorts, for example, experienceenhancedmobility prospects(Reed
chances by the same absolute of growthincreasespromotion 9Thatis, each additionalincrement to each unit of amount. Therefore, the proportionateincreases in mobility chances attributable growth become smaller (see Stewman & Konda 1983:653-55).
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1978, Stewman& Konda 1983). In the absenceof sustainedeconomic growth, opportunityis a zero-sum game, as the baby-boomgenerationhas realized all too painfully. Growthalso affects promotionopportunities by shapingorganizationaltenuredistributions(Pfeffer 1983:311-13). It reducesaverageseniority by expandingthe entry-levelcomponentand by promptingturnoveramong competing firms whose personnel are "raided" from each other. At the same time, it smoothes the tenure distribution,thus creating a gradedpromotional ladderthat induces younger workersto stay with the firm. Bielby & Baron's (1983) results were consistent with this hypothesis: after controlling for relevant individual and organizationalvariables, they found that employees of growing enterpriseshad worked there less time. An organization'stenuredistribution affects its sortingprocesses andopportunity structure; high-tenureorganizationsrely more on seniorityin rewarding workers (Halaby 1978, Pfeffer 1983). Organizationsstaffed by "oldcomers" also utilize less extensive, decentralizedcontrol mechanisms, since experienced workers have internalized the organization's goals and learned the relevant procedures and expectations (J. Pfeffer, J. Ross, M. W. Meyer, unpublished paper).Higherturnoveralso resultsfromboththe intergenerational conflicts and the lack of communicationthat occur when there is a discontinuous tenuredistributionand/orweak cohort bonds (McCainet al 1983; M. G. Wagner, J. Pfeffer & C. A. O'Reilly, unpublishedwork). Gendercompositionis anotherdimensionof organizational demographythat helps determineopportunity.The relationshipbetweenminoritygroupsize and inequality has been studied at the community level (e.g. Frisbie & Neidert 1977), but rarelywithin organizations.Kanter(1977) has arguedthatwomen's organizationaldisadvantagereflects the powerlessness implicit in skewed sex thatwomen face ratios, and Spangleret al (1978) have documentedthe barriers when they are a minorityin law schools. Sex ratios also affect and are affected Lonby organizationalchanges in technical and administrative arrangements. gitudinal analyses by Baron (1982:Chap. 7) indicate that organizational changes widen the distance between men and women with respect to skills, training, and opportunity,and that organizationalsex ratios are tilted toward men when skills are being upgradedor advancementopportunities are expanding. Dubnoff (1978a) has reportedsimilarresultsfor the Americanoccupational structureas a whole since 1940. Future research should examine other demographicdeterminantsof stratification.
The Impact of Technology

is one of the most contested The effect of technology on work and opportunity issues in social theory. Case studies and aggregate analyses have examined changes in technical skills (Warner& Low 1947, Bright 1958, Blauner 1964, Horowitz& Herrnstadt 1966, Scoville 1969, Braverman1974, Blau et al 1976,
ORGANIZATIONS & STRATIFICATION 45 Dubnoff 1978b, Spenner 1979, Rumberger 1981) and tried to determine whether societal evolution increases work demands, resulting in more challenging and rewardingwork, or has the opposite effect, leading to workers' immiserationand restrictingtheir career development. These studies sustain virtually any predictionabout the impact of changes in skills, by no means resolving the controversy.Given the diversityof units studied-e.g. workers, jobs, occupations, firms, and industries-methods employed, and skill measures utilized, the lack of consensus is not surprising(see Spenner 1983). theoristsandresearchers have also documentedthe effects of Organizational technology on careerstructures.Blauner(1964) posited thatautomationraises the averagelevel of workerskill and increasesthe variancewithinfirms, giving rise to skill-basedcareerlines thatreflectjob idiosyncracies(also see Doeringer & Piore 1971). Thompson (1967) hypothesized that there is a relationship between technology and mobility, which Vardi & Hammer(1977) verified. Long-linkedtechnologies (e.g. assembly lines) generatemore lateralmobility because workers are interchangeable.In contrast, mediating and intensive technologies (e.g. client-orientedbanksand researchlabs, respectively)foster more upward mobility, but the type differs. By favoring bureaucraticspecialization, mediatingtechnologies intensifythe role thatcredentialsand sponcareers. Intensive sorship(in additionto merit)play in shapingorganizational technologiesarecomplex andnonroutine.Workersarereciprocallyinterdependent and specialized professionalknowledge is crucial;consequently, career pathsoften transcendspecific organizations.Both tasks and workersare more homogeneous in long-linked settings; thus, objective criteria like seniority exerta greaterimpact governmobility. In contrast,workers personalattributes when intensive are involved (Vardi & on career attainments technologies Hammer 1977, Vardi 1980). Jacobs (1981) conceptualizedthe link between technology and mobility in similar terms, focusing on problemsof organizationalcontrol. He suggested that career opportunitiesreflect the relationshipbetween individual performance and organizationalsuccess. Mediating technologies, found in many service organizations, attenuatethe impact of a specific worker's output on organizational performance,therebyreducingincentives for rapidor frequent when skills arediverse and specializedand workers promotions.Furthermore, are highly interdependent,organizationalleaders cannot easily distinguish among individuals'output(Ouchi & Maguire 1975, Ouchi 1977). Poor individual performancecan significantlyhamperorganizationalsuccess, so internal mobility may be used to bindemployees' intereststo the firm's. At the same time, interdependenceintensifies pressurestowardcollective bargainingand nonmeritocraticpersonnel decisions, since positive individual contributions are difficult to detect. While administrative scientists have studiedthe connectionsamong organi-
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zational technology, structure,and control in detail, stratificationresearchers know relatively little aboutthe socioeconomic returnsto specific job tasks and skills. Some researchershave shown thatjob content differs significantly by race and sex and that minoritiesreap fewer dividends from specific skills and experience(e.g. Thurow& Lucas 1972;Lucas 1974;Brown 1975; McLaughlin 1978a,b; Rosenfeld 1980; Baron& Bielby 1982; Spenneret al 1982). However, researchersoften operationalizeskills andjob demandsin terms of education, experience, occupation, and similar variables that not only are weakly related to actual abilities and job content, but may actually measure quite different characteristicsfrom one particularsubgroup of the labor force to another.A fair assessmentof humancapitaltheoryandof the functionaltheory of stratificationrequiresmore precision in measuringthe productiveworth of workers, tasks, and jobs and its impact on careeroutcomes (Bielby & Baron 1983).
The Impact of Unionization

The presence of unions and collective bargaining arrangementsis another importantorganizational attributeaffecting opportunitiesand rewards. Because the incidence of unionismcovaries with the otherorganizationaldimensions discussed above-particularly size and technology-its independent effects on stratificationare difficult to disentangle.10This problem is exacerbated by the fact that most analyses of unions' influence on earnings and at eitherthe individualor aggregate(i.e. industrial inequalityareundertaken or areal) level of analysis. Unfortunately,in many cases evidence about unions' effects on careeroutcomes at the individuallevel does not concurwith research at the industriallevel, illustratingthe confusion encounteredin moving between disparatelevels of analysis.1l Unionizationexemplifies how "structural" constraintson wages and opportunity are inadequatelyrepresentedat eitherthe individual or industriallevels. Like firms, unions differ in size, growth rate, demography,history, and the like, and the meaningand outcome of collective bargainingdepend largely on the organizationalcontext. Freeman & Medoff (1979) summarizedtwo competing views of the relationship between unionism and inequality. Accordingto the "monopolypower" perspective, unions push wages higher than productivitywarrants,at the
about30%of the tendencyfor big firms to pay higher "0Masters (1969), for instance, attributed wages to greaterunionizationamong those enterprises. " Kalleberget al (1981), for example, reportedthatindividualmen are more likely to belong to unions when they work in labor-intensiveindustries,whereasWallace & Kalleberg(1981) found a strong positive relationship between unionization and capital intensity at the industrial level. Similarly, there is a much stronger relationship between work force composition (race, sex, (e.g. unionization,marketstructure,and average education, and the like) and industrialattributes firm size) than is observed among the same variables at the individual level.
ORGANIZATIONS & STRATIFICATION 47 same time widening disparitiesbetween advantaged anddisadvantaged groups. In contrast,the "collective voice" perspectiveregardsunionwage premiumsas reasonable reimbursementsfor the savings unions generate in terms of improvedgovernanceandsocial control. Moreover,unionsareviewed as equalizing agents, narrowingtraditionalracial and sexual disparitiesin rewardsand job assignments. These views are overly stylized, since unions have had both effects in different contexts. Taking an organizationalapproachto unions, Ashenfelter (1972) has argued that the impact of unionism on racial income inequality depends on whether black workers are available within the union's environment who can substitutefor advantagedworkers. Industrialunions have narrowed black-white income differentials, since a minority work force either alreadyexists or is easily mobilized in the organizationalsettings where these unions thrive. Craft unions, in contrast, have seldom embraced minority members(Aronowitz 1973), thus increasinggroupincome differences.12 This difference may also explain why blacks (especially males) receive greaternet economic benefits from union membershipthanwhites do (Beck 1980, Pfeffer & Ross 1981a). Unlike white workers, who dominate favored nonunionized jobs and industries,blacks are concentratedin work settings where unionization is often the only basis of job security and of obtaining higher wages. Similarreasoningmight be appliedto the relationshipbetween unionization and sexual inequality. Among women, however, the division between good and bad jobs does not overlap as much with the presence or absence of collective bargainingarrangements.Teaching and nursing-two of the most lucrativeoccupations for women-are highly unionized, as are some lowerstatuslines of work such as certainservicejobs in retailtrade,communications, and public administration. Career advancement among unionized women seems to depend less on firm-specific humancapitalthan it does among men, blacks (Pfeffer & Ross 1981a,b). Whereasmen benefit most from particularly possessing generalhumancapitaland a desirablesocial background outside the unionsector, the opposite is trueamongwomen. This fact suggests thatwomen are more likely to belong to unions in labor marketsthat span organizations (where backgroundand schooling would be applied to hiring decisions when women switched employers), ratherthan in labor markets where unions tie success to firm-specific service. On the other hand, women generally enjoy higherprestige and receive greaterreturnsfor their experience and trainingin nonunionjobs (Pfeffer & Ross 1981b). Like their white male counterparts,
'2Publicsectorunions have also mademoreprogresstowardequality,perhapsbecause the costs of transforming discriminatory personnelpracticesinto a nondiscriminatory system can moreeasily and invisibly be passed throughto consumers (i.e. taxpayers)in that sector. Lawsuits regarding comparableworth, for instance, have almost invariablybeen aimed at public sector employers.
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nonunionwomen may have alternateroutes to success throughorganizational advancementavailable to them, albeit with less pay and prestige than men
receive.
Unions emphasize seniority-basedrewards, and collective bargainingoften arises in work settings where it is difficult to discern the effects of individual performance(Jacobs 1981), thus weakening the relationshipbetween worker characteristics andrewards(Pfeffer 1983). Consequently,attainment models in which the effects of personaland organizational characteristics are not contingenton unionmembership (andvice versa)areprobablymisspecified. Moreover, unions tend to be consideredonly as individualor industrialattributes.In order to understandthe interplay between unions, firms, and stratification, however, scholarsneed to study unions as organizations,examininghow their internal makeup and their surroundingenvironment affect the relationship between collective bargainingand inequality. Adoptingan organizational theirrole perspectiveon unions also underscores in linking personnelpracticesand rewardsystems across firms. The effects of unionbargainsin certainoccupations,firms, andindustries"spillover"to other workers, although there is considerable debate about the nature of wage interdependency (Flanagan1976, Mehra 1976, Mitchell 1980, Lawler 1981). Interorganizational comparisons of rewards and working conditions are a standardpart of labor-management negotiations. Unions are thus central in defining organizationalnetworksand environmentsthat, in turn, shape stratification outcomes.
The Impact of OrganizationalEnvironments

In recent researchon economic and labor marketdualism, attentionhas been focused (wittingly or unwittingly)on how organizationalenvironmentsaffect and Marxistssuggest thatfirms' relations wages and mobility. Institutionalists to theirproductmarketsand theircontrolover industrialand political environments influence how work is organized and rewards distributed(Galbraith 1967, Averitt 1968, Bluestone 1970, O'Connor 1973, Friedman 1977, Edwards 1979, Berger& Piore 1981, Gordonet al 1982). While the combination of factors stressed depends on the investigator's theoreticalperspective, the in "core"or monopolisticfirmsand expectationthatgood jobs areconcentrated industriesis explainedby some combinationof the following attributes: technical mix; level of union and managementinterest in employment stability; ability to absorb higher labor costs due to market structure and demand schedules;growth, concentration,and change in organizationalforms; differences in the quantity and quality of managerialactivity; and economic and political relationships with the state and foreign markets. Accordingly, researchershave operationalizedeconomic sectors in terms of industrialdifferences along these dimensions, examining in turn, whether workers' sectoral
& STRATIFICATION 49 ORGANIZATIONS locations affect their careers (see Hodson & Kaufman 1982). Some analysts andbad (secondary)occupahave also developed typologies of good (primary) thatopportunities and rewardsdiffer between these labor tions, demonstrating markets(for a review, see Kalleberg& Sorenson 1979). Despite its initial promise, this approachto inequalityhas neithergenerated sustainedinquiry nor producedcumulative findings. Many hypotheses about but investigators constrainscareersareorganizational, how economic structure have implicitly equated environmentswith industrialphenomena. Yet those industryattributesthat are used to demarcatesegments do not cohere neatly (Kaufmanet al 1981, Wallace & Kalleberg 1981), and the effects of industrial on attainment dependvery muchon the variablesandtypologies used structure to represent workers' sectoral locations (Kalleberg et al 1981, Zucker & industrial sector schemes fail to capturemany Rosenstein 1981). Furthermore, andcareeroutcomes. arrangements hypothesizeddifferencesin organizational For example, Cohen & Pfeffer (1984) found that distinctions among broad industrial sectors did not capture much of the variation in organizational personnel practices that is predicted by dualists. Similarly, Jacobs (1983) by industrialsectors and that reportedthatcareermovementis not demarcated sectoralboundariesdo not disproportionately impedemobilityamongminority workers. Rather than focusing on coarse dimensions and typologies of industrial should specify relevantorganizational researchers environments,stratification and reward and examine their impacton work arrangements subenvironments structures. No doubt the most conspicuous environmentaldeterminantof of firms. Because geographydelimits opportunityis the locationaldistribution productand labor markets,as well as areal customs affecting employer practices, competing firms in a locale often develop similarpersonnelpolicies and andmobility rewardsystems (Dunlop 1957). Accordingly,wage determination & across areas Thal-Larsen 1969, Rees & (Gordon processes differ markedly Schultz 1970). between space and Very differenttheoreticalexplanationsof the relationship differences in Areal have been advanced. wages andopportunities stratification may reflect residentialsegregation, productivitydifferences, and the relative flows arespatialsize of minoritypopulations(Parcel 1979). Since information and contact networks employees also diffuse amongemployers ly constrained, informationaboutpersonnelpractices,job opportunities,and wages within an area(Rees 1966, Granovetter1974). Pred(1977) linkedregionalinequalitiesto corporateinformationalnetworksand locationaldecisions. Since the value of informationdiminishes with the distance travelled, employers develop local networks and business activities agglomeratespatially. Thus, informalbusiandtransportation ness networksoffset the effects of improvedcommunication which otherwise might reduce regional economic disparities. infrastructure,
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Marxists have suggested that this process is not benign; rather, the spatial division of labor is partof capital's strategyof segmentingthe working class (and the rewardsreceived) in order to minimize its collective power (Clark 1981, Storper& Walker 1983). areal affects to culture. Comparative Otherinvestigatorsattribute organizational analyses show how culturalpracticesinfluence work arrangements and rewardstructures (Freedman1969, Gallie 1978). Aftercontrollingfor regional differences in tenure, professionalization,and civil service coverage, Halaby (1978) foundthatSoutherngovernmentfinancebureausemphasizedsuperiors' evaluations(versus formalexaminationsand seniority)in promotiondecisions more than bureaus located elsewhere did; he interpretedthese differences as legacies of culturaldifferences in the bureaus'environments. Analyzing wage determination among federalgovernmentagencies, Borjas (1980) developed anotherperspective on the spatial bases of inequality. He treatedthe spatialconcentrationof each agency's constituencyas an indicator 13He also measuredthe numberof of the constituency'spolitical organization. constituentsas the populationin states where an agency's expenditureswere recorded, and he used personnelhomogeneity with regardto education, age, and tenureas an index of the degree of bureaucratic power in agencies. Borjas concludedthat "employees in agencies with small and well-organizedconstitthatapparently sharecommon uencies, and with [homogeneous]bureaucracies interests, generally receive higher wages" (1980: 1142). Clarifying the spatial and environmentalbases of inequalityrequiresidentifying majortheoreticalapproachesthat might be used in studyingthe effects of organizational environments on stratification. In the remainderof this section, I will review two currentapproachesto the study of organizationenvironmentrelations-population ecology and resource dependence-suggesting how they might inform studies of labor marketoutcomes. Proponentsof the populationecology model view organizationalarrangements as the resultof a selection process in which survivaldependson fitness vis-a-vis the environment(Aldrich & Pfeffer 1976; Carroll 1984). Organizations evolve forms, i.e. combinationsof goals, structures,technologies, and boundaries, that are appropriate given their resource environments(Aldrich 1979). This formulationis quite similar to some portraitsof economic segmentation. Like organizationanalysts who study environment-structure fits (e.g. Ashby 1968, Hannan& Freeman1977), segmentationtheoristsposit that organizationalforms and environmentscohere: large, "core" bureaucracies
'31t is not coincidentalthat the effect of the political environmenton wage determination has been studied principallywithin the public sector, where its influence is most conspicuous. Yet publicsectorwages dependon settlementsreachedin monopolyindustrieswherewages also reflect political "clout"(O'Connor 1973: 30-32).
ORGANIZATIONS & STRATIFICATION 51 dominate complex, central, interdependent environments, while small, "periphery" enterprisesabound in marginal, competitive industries.The two ideal types, in turn, are hypothesizedto differ in their employmentpractices. Populationecologists, however, would take issue with this dichotomybetween core and peripheryorganizations,emphasizingthe diversityof forms thatexist as a resultof variedorganizational environments(McKelvey & Aldrich 1983). Wholey (1983) used a populationecology model to study mobility in the legal profession. He examined personnel flows among law firms in order to isolate populationsof firms thatoccupy a sharedresourceniche, namely, they recruit from the same labor pool and have similar personnel policies. If generalizable, his approachmight be employed to specify the organizational ecology of opportunityby identifying networks of firms having comparable stratificationsystems. Populationecologists suggest that organizationalarrangements are molded by the environmentthat exists when an organizationis founded. Although organizationsadaptto changes in the environment,theiractivities also tend to over time because too much rapidchange in specific become institutionalized organizational practiceswould threatenthe long-termviabilityof the organization as a whole. Stinchcombe(1965; see also 1979) describedhow the conditions that prevailed when industrieswere founded affect their work arrangements and reward systems. His findings were substantiatedby Meyer & Brown's (1977) analysis of "origin effects" on personnel practices among governmentalfinance agencies. As both Stinchcombe and Starbuck(1965) predicted, organizations founded recently resemble the Weberian model of the most. The finance agencies also developed more formalized bureaucracies and bureaucratic personnelproceduresas they aged. Maniha(1975) reported similarresults in a study of the St. Louis Police Department since 1869; merit and seniority increasinglydominatedpromotiondecisions as the organization aged and became more bureaucratic. thusdrawattentionto the environmental Ecological analysesof stratification circumstancesfavoringthe selection and institutionalization of particular types of employment relations and rewardsystems. The ecological approachpays less attentionto the specific actors and mechanisms that perpetuateor alter organizationalforms, however, and focuses instead on how changes in the of practicesacrossenterprises.The resourceenvironmentaffectthe distribution resource dependence approach, in contrast, examines how individual firms theirenvironments(Pfeffer & Salancik 1978). define, adaptto, and transform More than the populationecology model, this perspectiveinspireshypotheses abouthow the organizationalstandingof specific membersshould be affected by changes in the environment.For instance,businesses' politicalenvironment has become increasingly importantin determining personnel practices and rewardsystems, as forces outside the firm (e.g. governmentagencies and civil
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rights groups) have intervenedin the employmentrelationship.Accordingly, job opportunitiesfor disadvantagedworkers have improved substantiallyin those firms and industries that depend on government support and/or are subjectedto the most extensive regulatorypressure(Salancik 1979, Shaeffer& Lynton 1979, Beller 1982, O'Farrell& Harlan 1982).'4 Resource dependence theory implies that an individual's organizational standing reflects his or her ability to buffer the impact of key uncertainties outside (or inside) the organization. For example, executives tend to have backgrounds in the function that is most crucial in linking the firm to its researchanddevelopmentin craftsettings;productionandoperaenvironment: tions managementin mass production;and marketingand sales in continuous processing(Woodward1965). Consequently,changes in the crucialdilemmas confrontingorganizationsalter the distributionof rewardsand opportunities, favoringthose individualsand subunitsthatcan controlkey areasof uncertainty. For instance, the changing regulatoryclimate has heightened businesses' dependence on specialized personnel managementto avoid discrimination lawsuits (O'Reilly & Anderson 1982). The enhancedorganizationalstanding of human resource managementillustrates the potential applicabilityof resource dependencetheory to stratificationresearch, which to my knowledge, has not been pursued.15 for explicitThe resourcedependenceperspectivealso providesa framework dependence of personnel practices that ly modeling the interorganizational some dualist theoristsemphasize. Just as firms have "keyjobs," to which the wages of otherjobs are pegged (Dunlop 1957), industrieshave key firms and unionswhose policies affect personnelpracticesandemploymentopportunities elsewhere (Averitt 1968). Because dependencycreatesuncertainties,firms try to manage interdependenciesthrough formal and/or informal coordination. When such coordinationis successful, personnel practices, wage schedules, and mobility regimes are likely to diffuse across organizations.Aiken & Hage are more likely to (1968) have found thatorganizationswith similarstructures relations. The reverse seems equally engage in formalizedinterorganizational likely, however, i.e. linkages enhance "social comparison,"as when unions
"'The evidence is far from conclusive, however; see, for example, Smith & Welch (1977), Burstein (1982), and the literaturethey cite. '5The resource dependenceview resembles the functional theory of stratification,which has been examined empirically (e.g. Cullen & Novick 1979). However, the latter theory and the of tasksto society as a whole. Key requisitesof researchtesting it referto the functionalimportance societies areassumedto be relativelyinvariant,accountingfor the observedstabilityin occupational prestige ratings across time and place. Functional requisites may not be so inert within organizations, and researchon executive compensationshows no link between managerialcontributions(if these are indeed measurable)and organizationalrewards(Broom & Cushing 1977, Allen 1981).
ORGANIZATIONS & STRATIFICATION 53 and managementconduct marketwage surveys, and thus organizationalinterdependence should encourage shared practices for managing all types of resources(see DiMaggio & Powell 1983). Personnelmovement, for example, is one kind of interorganizational exchange thatis bothcause and consequence of organizationalsimilarity (Baty et al 1971, Pfeffer & Leblebici 1973). There is little evidence abouthow (or whether)interorganizational relations of personnel affect personnelpracticesand rewardsystems. The proliferation management associations, human-resourceconsulting firms, government agencies, watchdog groups monitoringemploymentpractices, industrialand regional employer associations, unions and other employee associations, and business schools has helped diffuse employmentpracticesacross firms, industries, and locales. Personnel policies should disseminate most among large firms and within monopolistic industries, where organizationscan manage their dependencies (cf. Starbuck 1976; see National IndustrialConference Board 1940 andGordon& Thal-Larsen1969 on firms' use of communitywage surveys).
Summary
The recentinterestin internallabormarketshas focused attentionon organizaof stratification.I have arguedthat comparativeorganizational determinants for resolving theoreticalcontroversiesabout the tional researchis appropriate origins and consequencesof careerhierarchies.Accordingly, this section has reviewed the impact of specific organizationaldimensions-size, growth, of opportunidemography,technology, and unionization-on the distribution on economic dualism concerns and Research the effects ties rewards. implicitly on have and environments reward that organizational personnel practices systems. It is difficultto interpret specific environmental,sectoral,or industrial an explicit perspectiveon effects on labormarketoutcomeswithoutarticulating relationsfirst, as the diverse explanationsof spatial organization-environment variationin earningsdemonstrate.I discussed two reigning approachesto the study of organizationalenvironments-population ecology and resource dependence-and their applicabilityto labor marketanalysis. on aspects of organizationsand theirenvironThis section has concentrated of "emptyslots" in the economy. By mentsthathave an impacton the structure determiningthe distributionof positions and the rewardsattached to them, organizationsexert an effect on labor marketoutcomes that is independentof of workers.Moreover,organizationsalso shape attainments the characteristics by virtue of how they match specific workersand slots, the topic of the next section of this review. The division between these two sections is admittedly imprecise, since many of the factorsthatdeterminean organization'slevel of opportunitiesand rewardsalso affect the criteriaby which workersare sorted into jobs.
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ORGANIZATIONALVARIATION IN SORTING PROCESSES Models of EmployerDecision-Making

Conventional economic theorists discuss sorting processes in terms of an equilibriumbetween labor supply and demand. Workerspossess vocational aspirations,which are treatedas exogenous, and invest in humancapital so as to maximizetheirutility and earnings, subjectto variousconstraints(including innateability). (See D. T. Hall 1976, Schein 1978, andLondon& Stumpf 1982 on vocationalchoice.) A firm's labor for reviews of the psychologicalliterature needs are determined by its technology (capital-laborratios) and product demand.The pricemechanismis assumedto clearthe market,andthe question of which workersare matchedto whichjobs does not appearto be problematic to neoclassical microeconomists. The proponentsof various economic and organizationalmodels reject the underlyingassumptionsthatboththe workerandthe firmhave perfectinformation andpursuea maximizingstrategyin theirpersonneldecisions. They do not necessarily embrace the neo-Marxianidea that a "controlimperative"shapes employment relations, however. Indeed, currenteconomic models of labor marketsroutinelyacknowledgethe limits of employerand workerinformation (Lippman& McCall 1976). March & March(1977, 1978) have shown how these limits affect organizationalcareers. They posit that employers possess aboutemployee performance andthatthe process matchimperfectinformation individualsto indistinguishable jobs is stochastic(also see ing indistinguishable also. Romanow 1983); similarprocesses arepresumablyat work in recruitment Variabilityin employers' proceduresfor sampling workerbehavior produces differential promotion rates. In fact, "sampling phenomena associated with performanceevaluation can become significant enough to mask variationsin the underlyingattributesof individuals, even in cases in which those underlying attributes are known to affect job performance" (March & March 1978:448). Their model implies that the longer workers remain with the organization,the more accuratelyemployerscan assess the employee's underlying capabilities, since the sampling variabilityof any proportion(here, the candidate's "success ratio") diminishes as the number of trials increases. Organizationsthus face greatestuncertaintyin evaluatingemployee potential early in their careers. Diverse accounts have been offered as to how employers cope with this dilemma. Some theorists propose models of "statistical discrimination"in which employers possess less accurateindices of potential for one group of workersthanfor the others. Inferiorknowledgeaboutits membersandthe costs of remedying that ignorance militate against hiring or promoting individuals
ORGANIZATIONS & STRATIFICATION 55 from the disadvantagedgroup, even if they exhibit stellarqualitiesthatcontradict past experience(Aigner & Cain 1977, Lundberg& Startz1983). Economists and sociologists have proposed formal models and provided empirical evidence about educational credentials as one organizationalsignal of employee potential under imperfectinformation(e.g. Berg 1971, Spence 1974, Wilensky & Lawrence 1980, Faia 1981). Marxists (Bowles & Gintis 1976, Edwards 1976) argue that employers are motivated by a need to control the work force and use schooling to determinewhetherworkers'values and traits for the organizational areappropriate controlsystem in place. Marxistssuggest that the form and content of schooling mirrorsthe modem workplaceand that educational stratificationprovides a basis for differentiatingworkers. High school graduates,for instance, arelikelierto follow the rigid bureaucratic rules used to controlworkersin thejobs to which those studentsare destined. Higher education, in contrast, promotes the internalizationof norms and values requiredfor higher status "primary" jobs. Collins (1979) has also discussed the use of educationalcredentials as a means of organizationalcontrol; without assuming the existence of underlying class antagonisms, he claims that an individual'sschooling signifies to competingorganizational coalitions whether one is a likely ally. Schooling is only one of many signals employersuse to cope with evaluative uncertainty.Kanter(1977) has arguedthat managersengage in "homosocial because similaritieswith respectto sex, race, social background, reproduction" and family status indicate whethersomeone can be trustedand whethercommunication with him or her will be easy (also see Dalton 1951, Coates & Pellegrin 1957, Pfeffer & Ross 1982). Pfeffer (1977) found that class backgroundaffected managers'incomes more when evaluationwas difficult, as in staff positions and smallerfirmswith less comprehensiveinformationsystems, and in industrieswhere personal contact is likely to be important. Stinchcombe(1965) relatedthis homosocial reproduction to organizational life cycles. Lacking establishedproceduresand stable contact networks, new organizationsrely on diffuse indices of competenceand loyalty, such as social backgroundand educational credentials. Collins (1979) has suggested that technologicalchange may have the same effect as newness, since well-defined benchmarksof performanceare less reliable. Since normative control is a hallmarkof managerialand professionalpositions (R. H. Hall 1975:Chap.4), these occupationsandthe subunitsthey constituteareparticularly susceptibleto homosocial reproduction.Once in place, the practiceof hiring and recruiting similarindividualsoften becomes institutionalized,especially when organizational memberswho monopolize a credentialor backgroundtraitcan define it as a prerequisitefor employment or advancement. Since employersface greateruncertainty in evaluatingnew or inexperienced
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employees, they should rely more on backgroundcharacteristics early in the career.16 Interestingly,while Pfeffer (1977) found thateducationalcredentials affect salary most at the beginning of the career, the opposite is true of social class background.Unless social class is a proxy for specific vocational abilities, this finding implies that employment decisions do not become more objective over the course of an individual's career, even though employers possess more reliable information. The finding that early career stardom facilitates subsequentachievementpoints in the same direction(Kanter1977, Rosenbaum 1979); several explanationsare available. used to evaluate performancebecome more ambiguous First, the standards become increasinglyvague as one moves up a hierarchy and task requirements (Dornbusch & Scott 1975), so ascriptive characteristicsmay become more for advancement.Second, expectationsstronglyinfluencebehavior; important employees designatedearly as "stars"are likely to behave and to be treatedas such (Berlew & Hall 1966). Third, employersmay escalate their commitment to ill-fated prior choices; instead of changing behavior in light of negative feedback, individualsandgroups"seekto rationalizetheirpreviousbehavioror psychologically defend themselves against adverse consequences" (Staw 1976:27). These processes could accountfor homosocial reproduction even in the face of accurateinformationregardingjob candidates. Employerrationalityis not simply "bounded" (March& Simon 1958), it is sometimes illusory. Personnel decisions may reflect random variation, as March& March(1978) assert, but organizational membershave considerable incentives for believing thatmanagerialbehavioris purposiveandefficacious. As Salancik(1977:71) notes, "itwould not make sense to say it does not matter who is chosen [for a job]. It is supposed to matter;the myth is that it does matter.Withoutthis myth we would not invest much authorityinto those who are chosen. And that would make a difference for an organization." Even if employersmakeperfectlyrationalpersonneldecisions thatoptimally matchworkers, skills, andjobs, organizational membersbelieve thatdecisions abouthiring,promotions,andrewardsdo controlbehavior.Personnelpractices andrewardsystems area centralfeatureof an organization'scultureandcontrol system. Thus, the discrepancybetween "efficiency"and"control" imperatives in organizationaldecision-makingseems greaterin theory than in reality (cf. Dunlop 1957:14; Sorensen 1983). One need not believe that employers intento coopt dissent in orderto agree that tionally organize work and opportunity their actions have those consequences. Moreover,variousmodels of organizationalbehavior, such as Williamson's(1975, 1981) "market failure"approach, embrace efficiency and control aspects of the employment relation.
160f course, some employers may opt for elaboratetrainingand socialization or pay higher wages to attractqualified personnel, in lieu of extensive screening procedures(Ullman 1968).
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OrganizationalCareer Stages
resourcesdo not have the same effects on achievePersonaland organizational ment throughoutan individual's career. While researchersoften distinguish between a person's first job and his or her currentjob in studies of socioeconomic attainment, as well as noting differences across age cohorts, more careerdynamics. A careeris distinattentionshould be paid to organizational guished by fairly discrete stages, each involving a different relationshipbetween the worker and the firm (D. T. Hall 1976: Chap. 3, G. W. Dalton et al 1977; Schein 1978: Chap. 4; Viega 1983). Previous research indicates that early careerattainmentsare likely to reflect individuals' success in exploiting to pass initial "tests"(formal and infortheir ascribedand achieved attributes success is determined mal) and become effectively socialized. Organizational this immediate one's During stage, peer groups are an largely by supervisor. important source of formal training and informal shaping. Later, familial constrainworkers'achievements,particularly attachments amongwomen. The search for mentors and a network of organizationalcontacts intensifies, now that both the worker and the organizationhave greaterexperience with one another.Family commitments,habituation,and the aging process increasethe success is attractivenessof extrinsic rewardsandjob security. Organizational now defined more in termsspecific to one's organization,profession, community, or other restricted reference group and may approximate a Markov process (i.e. reflectingpriorsuccesses andtenure)morethanin the early stages of the career (Halaby 1978:481; Rosenbaum 1979).
Interdependenceof Workers'Career Outcomes

shows how the criteria Kanter's(1977) discussion of homosocial reproduction appliedin hiring and promotiondecisions dependon organizationaldemograto similarity, so attraction phy. Social psychological theorylinks interpersonal in-groupmembersshouldsearchfor obvious signs of homogeneitywith respect to sex, race, age, social background,and the like. The way specific attributes are evaluated depends on the demographicfit between an individual and the relevantorganizationalelites. Ceterisparibus, individualcharacteristicssuch as backgroundand schooling are likely to yield greater career benefits: (a) when sharedby a powerfulorganizational coalition;and (b) when an intermedi17 While being a of members has those attributes. ate percentage organizational attention(Northcraft can have the benefitof attracting & Martin1982), "token" as relevant. On the other one is unlikely to be able to define his or her attributes
17Career advancementoften occurs withinoccupationalcategories. Moreover,income changes andjob advancement,while correlated,arenot proxies for one another,since eitherone can change alone. Consequently, it is worth noting that specific criteria might be strongly related to job advancementbut bear little or no directrelationshipto income or occupationalstatusattainment.
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hand, an attributeshared by too many people does not help to discriminate among workers. Career outcomes are also interdependentbecause positions are clustered andbecause workplacenormspromotesocial technicallyand administratively, within and comparison(e.g. amongfemale workers).Wages andopportunities acrossfirmsarelinkedto "key"rates, which typicallyarederivedfromjobs that are stable, prominent,not specific to one organizationor subunit, more desirable, and staffed by many workersratherthan by a single individual(Dunlop 1957, Livernash 1957, Hildebrand1963). Therefore, workers' fates depend considerablyon the wages and mobility among employees in these key jobs, both within one's own firm and in comparableenterprises. M. S. Granovetter (unpublished work)has madethese same points differently, noting that orthodox economic theories abstractactors from history and fromone another.Social relationshipsin the workplaceareconstrainedby past practicesand interdependencies among individuals.A careeris constrainedby how people have previously evaluatedthe workerand otherrelevantworkers. Moreover, an individual'scareercannotbe predictedor understoodapartfrom his or her relations with co-workers, collaborators, supervisors, and even refers to these complications as people outside the organization.Granovetter embeddedness." "historical"and "structural As noted above, certainkinds of personalinterdependence (e.g. with entry cohorts,peers, mentors,family, andprofessionalcolleagues) aremore decisive at particular stages of the career (Granovetter 1974; Lin et al 1981a,b). Moreover, embeddednessis more importantin some contexts than in others. For instance, interdependence among careersmay be greateramong members of an organizational minority,since theirvisibility causes actionsto be generalized to all members of the category and the pressures of minority status strengthensolidarity within the group (Kanter 1977:214). Settings requiring more interdepenon-the-jobtrainingalso makeworkers(andtheirattainments) dent, enhancing social comparisonprocesses and concerns about workplace equity (Doeringer & Piore 1971, Williamson 1975, Thurow 1975). Contact networks are particularlyimportantfor careers in the professions, manageties are crucial-and in ment, and some crafts-where extraorganizational organizationsthat exhibit task ambiguity, normativecontrol, and intense collaboration(Granovetter1974, Kanter 1977, Collins 1979). Another source of career embeddednessreflects the fact that individuals often monopolize organizational job titles, so it is hardto distinguishbetween of jobs andof the incumbentswho fill them.18 Manyjobs are the characteristics shapedaroundthe distinctivecompetenciesof specific individuals;thejob does
"8Baron (1982) found that 47% of the jobs in a sample of 415 organizations only had one incumbent, although only 8% of workers were in such jobs.
& STRATIFICATION 59 ORGANIZATIONS not precedethe individual,eitherlogically or temporally(A. S. Miner, unpublished study). This phenomenonoccurs more often where personal contacts occupations play a majorrole in careerprocesses, as in "independent primary" and certain industries (e.g. entertainmentand finance). Furthermore,Miner argues that environmentalturbulenceand change favor molding jobs around individual attributesin order to deal with uncertaintyand that high status, powerful, senior employees and subunitsuse this strategymost often. When job attributesevolve around incumbents, career outcomes depend on the idiosyncratic relations between the worker and the organization (including relations with co-workers and supervisors). The conceptualandmethodologicalimplicationsof careerembeddednessare career outcomes imply two methodologicalcomstaggering. Interdependent plications: (a) error terms are dependent across individuals; and (b) more importantly,one worker's attributesand relationshipswill affect other individuals' outcomes. Consequently, the methodologyof attainmentresearchwhich usually employs national labor force surveys-appears ill suited to studying careers in organizations, where people, jobs, and rewardsare both This review has indicatedsome of objectively and subjectivelyinterdependent. the contexts within which career outcomes are most intertwined, so that will investigatorscan at least determinewhen ignoring that interdependence produce biased empirical results.
Summary
andhumancapitalapproaches,researchers In abandoning the statusattainment have acknowledged that not all organizationsemphasize the same criteriain selecting and advancing workers. Orthodoxlabor marketresearchassumes a simple "wage competitive" model, viewing workers as entrepreneurswho marketthemselves to the highest biddingemployer(Thurow 1975). However, "insteadof people looking for jobs, there arejobs looking for . . . 'suitable' people" (Thurow 1972:68). Therefore,researchersmust explicitly study how employers structure jobs and screen prospectiveemployees. This section has described certain organizationalaspects of that process matching workers, jobs, and firms.
ON THE EFFECTSOF STRATIFICATION ORGANIZATIONS

of workers, organizaStratificationnot only reflects but determinesattributes hierarchies tions, andenvironments.Ironically,the impactsthatorganizational have on individualsand society are a centralconcern in classical social theory (Giddens 1971), butthey have receivedtoo little attentionin recentmainstream research. By abstractingthe attainmentprocess from its organizationaland
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of personinstitutionalcontext, investigatorshave focused on the determinants al success or failure, rather than on how the distributionof labor market outcomes affects individuals, firms, and society. Theorists and researchersdisagree vehemently over how hierarchy and inequality influence organizationaleffectiveness and individual well-being. Followers of Weberand Durkheimregardhierarchyas efficient and inevitable (e.g. Dahrendorf1959, Hage 1965). As job skills become increasinglycomplex and the division of labormore detailed, workersidentify more with their work roles, experience greater security by having organizationalcareers, what is expectedof thembetter,andaremorecohesive as a resultof understand theirinterdependence (Blauner1964, Kohn 1971). Others,however, associate hierarchywith alienationand pathologicalconformity (Aiken & Hage 1966, Tannenbaum et al 1974). Marxists, in particular,regardworkplacestratificaclass divisions within the tion as a means of controllinglaborby reproducing firm. Mobility systems foster organizationalloyalty by catering to workers' preoccupationswith status and prestige, but they can also foment unrest by of organizationalcontrol underscoringthe capriciousness and arbitrariness (Sennett & Cobb 1972, Wachtel 1974, Kanter 1977, Edwards 1979). Ironically,both advocatesof the radical"control" perspectiveandefficiency theorists apparentlyagree that hierarchyis functional in organizations,even though they emphasize different functions. Yet there is remarkablylittle systematicresearchaboutwhetherstratification actuallydoes enhanceorganizational performance. In fact, some investigators have argued that graded mobility hierarchiesreduce turnoverand promotean instrumental orientation towardwork, diminishinginnovationand organizationalperformance(D. R. Dalton & Todor 1979, Staw 1980, Pfeffer 1983). Paulson (1974) found that healthorganizationshaving lower ratesof internalmobility (i.e. greaterexternal recruitment) were less effective in satisfyingtheirgoals but moreinnovative His cross-sectionaldesign andrestricted thantheirmorestratifiedcounterparts. however. sample limit the generalizabilityof his findings and interpretations, Regrettably, the absence of sound empirical research on the organizational consequences of inequality has not preventednumerouspopularpronouncementson the topic, as evidencedby recentdiscussionsof Japaneseemployment systems. Stratification regimesalso affect relationsamongorganizations,particularly personnel flows. Brittain& Freeman(1980, 1983) tracedthe high volume of withinthe semiconductorindustryto interfirmmovementandentrepreneurship in staffed mobility blockages companies by young executives. Paulson(1974) internal that for upwardmobility argued by encouragingworkers, opportunities facilitate communicationand innovation, which in turn, necessitate linkages with other organizationsin orderto obtain necessaryresources. His empirical results, however, were ambiguous:a highrateof internalmobilitydid facilitate
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interorganizational relations by fostering communication,but it also had the opposite effect by increasingeffectiveness and diminishinginnovation. Orgaare more likely to develop formalinterorganinizationswith similar structures zationalrelations. DiMaggio & Powell (1983), for instance, hypothesizedthat organizations relying on educational and professional credentials in hiring become isomorphic with the other members of their interorganizational network, since the cosmopolitanismassociatedwith formalschooling andprofessionalism promotes the diffusion of organizationalarrangements.Futureresearch should devote more attentionto the impact that a firm's opportunity relations. structureand screening procedureshave on interorganizational
SUMMARY AND CONCLUSIONS

and humancapital investmentlooked Researchersanalyzing status attainment at the labor marketand observed individualsstrivingto get ahead. Recently, investigatorshave takena differentview of the labormarket,focusing on what cannotbe so directly observed-i.e. the positions individualsoccupy in organizations and the processes that match workers and roles. Stratificationis inherentin the way organizationsstructurepositions and sort personnel, and this has been the focus of a burgeoningliteraturerelating organizationsand stratification. Comparativeorganizationalresearch is essential if we are to understand and the processes by which workersandjobs are matchstructures opportunity ed. Although wage determination,advancement,and matchingoccur within work organizations,many recent studies have examined organizationalinfluences on labor marketoutcomes only obliquely, if at all. Researchersoften attemptto make inferencesabouthow and why internallabormarketsfunction when organizational from individual-levelanalysesof careerattainment; influaretypicallyused as proxies. Another ences are examined, industrialattributes has recentlyused occupationsandindustriesas the unitsof groupof researchers analysis, seeking to identify segments of the labor marketand economy that exhibit distinct stratificationregimes. These analytic strategies are likely to experience diminishing returns, since the hypotheses of interest primarily concern why certain firms provide greateropportunitiesthan others and why they utilize particularprocedures in hiring and promotion. This paper has reviewed recent theory and research that addresses those concerns, linking specific dimensions of organizationsand their environmentsto stratification to characterize outcomes. Because it would be premature this field in termsof clear-cutparadigms,I have focused insteadon the diversity of organizational approachesand variables employed in studying inequality and opportunity. By eschewing organizationalapproachesto inequality, analystshave overthat affect labor marketoutcomes: links looked two kinds of interdependence
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amongindividualswithin an organizationandinterorganizational relationsthat have an impactupon employment. Studies of attainment at the individuallevel treateach actor as independent,which is implausibleonce the organizational context of careers is acknowledged. Similarly, recent "structural" analyses treateach firm or industryas independent,which seems unjustifiedgiven that interorganizational relationsdefine industriesandthe boundariesamongthem. Every unit of analysis implies a set of priorities, and I believe it will become increasinglydifficult for investigatorsto justify analytic strategiesthat ignore the interdependence of career outcomes within and across organizations. Researchersoften explain differentialattainmentsas a functionof job characteristics,such as authorityand skill. They do not specify whenjob characteristics affect labor marketoutcomes most, however, because it is occupations abstracted from theirorganizational context, not jobs, thathave typically been studied. Since many workers have molded theirjobs aroundtheir individual traits, it is difficult to disentangle the effects of personal attributesand job characteristics on wages and opportunities.Similarly, because many jobs are idiosyncraticto one organization, it is hard to distinguishjob-level determinants of career outcomes from firm-level determinants.Many autonomous, "independentprimary"occupations (e.g., law, plumbing) involve interfirm movement, so job content is comparableacross settings and marketforces are likely to equilibrate wages and opportunities across organizations. At the bottomof the occupationalhierarchy,"secondary" jobs are also similaracross organizations,providing low wages and little opportunityfor advancement, regardlessof setting. In contrast, the content of "subordinate primary" jobs andclerical positions) (e.g. semiskilledfactorywork, low-level administrative varies more across firms, so that the effect of specific job characteristicson attainmentshould depend most on the organizational context within that between specific job characterissegmentof the labormarket.The relationship tics and careeroutcomes should also be strongerin some firms than in others. Older, larger, and more bureaucratic organizationstend to have standardized and formalizedemploymentpractices. They are more likely to make explicit comparisonsamong jobs in structuringrewards, and consequently, the distribution of job characteristics shouldbe relatedto outcomes morethanin other enterprises.This discussion illustrateshow organizationalreasoningcan help generatea contingencymodel of labormarketoutcomes thatidentifies when a given employee or organizationalattributewill be most decisive and why. Advocates of "open system" perspectives in administrativescience link to environmentaldemands. Accordingly, I have organizationalarrangements speculatedin this review on how dependenciesbetween organizationsandtheir environmentsinfluence personnelpolicies and rewards. Organizational interdependence and environmentalturbulence are increasing and having more visible effects on work and opportunity,so I expect that future stratification researchwill devote greaterattentionto studyinginterorganizational networks
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effects on employmentand and discovering how firms mediateenvironmental attainment.19Accordingly, I have illustrated the potential applicability of to labormarketstudpopulationecology and resourcedependenceapproaches ies. dimensionof Futureresearchno doubt will also recognize the international stratification.Multinationalization,labor migration, domestic plant closings ecodue to the transferof productionoverseas, and a changing international nomic hierarchyhave highlighted the "modernworld system" of inequality. underRecentcollaborativeeffortsbetweenAmericanandforeigncorporations personnelpolicies, opportunities,and rewards score how work arrangements, in US enterprisesdepend on practices abroadand vice versa. In conclusion, organizationalstudies of inequality have altered the key theoreticaldebates, the relationshipsexplored, the dataunits analyzed, andthe methods employed in stratificationresearch. Methodological pluralism has been one consequence as researchon inequalityhas become more catholic and interdisciplinary.Many students of organizationsand stratificationwho had previouslyspecialized in one of those two subdisciplinesarenow applyingdata sources and researchmethodsdeveloped in one of them to answera new set of questions. Samplingorganizationsis clearlymore complicatedand costly than samplingindividuals,so futureworkis likely to continueblendingcase studies, research comparativeorganizationalanalyses, and individual-levelattainment incorporatingorganizationalvariables. Regardless of methodology, however, the study of mobility and wage determinationhas become inextricably and irreversiblytied to the study of analyststo consider organizations.It is increasinglyde rigueurfor stratification (or at least mention) organizationalfactors affecting career outcomes, while recent administrativescience reviews entreatinvestigatorsto pay attentionto workplaceinequalities(Scott 1981, R. H. Hall 1982). By outlining the determinants and consequences of organizationalstratification,this review will hopefully aid in formulating hypotheses and designing studies for future research.
ACKNOWLEDGMENTS
The author was supported in part by a grant from the National Science Foundation(SES 79-24905). David Callaway'stechnicalwizardryis dutifully acknowledged.HowardAldrich,WilliamBielby, Yinon Cohen, Alison DavisBlake, Neil Fligstein, Mark Granovetter,Arne Kalleberg, Donald Palmer, Jeffrey Pfeffer, Allyn Romanow, W. Richard Scott, and Ross Stolzenberg offered very helpful comments on far too many drafts of this review.
current '9Historicalresearchon the laborprocess is also likely to continue, since understanding work arrangements requiresknowing how andwhy organizationsrespondedto changingenvironments.
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Organizational Perspectives on Stratification Author(s): James N. Baron Source: Annual Review of Sociology, Vol. 10 (1984), pp.

ORGANIZATIONAL PERSPECTIVESON STRATIFICATION

OF INEQUALITY: THE ARCHITECTURE IN OPPORTUNITY VARIATION ORGANIZATIONAL REWARDS AND OrthodoxApproaches

The Internal Labor Market: CompetingInterpretations

The Impact of Size

The Impact of Growth

The Impact of Demography

The Impact of Technology

The Impact of Unionization

The Impact of OrganizationalEnvironments

ORGANIZATIONALVARIATION IN SORTING PROCESSES Models of EmployerDecision-Making

Interdependenceof Workers'Career Outcomes

ON THE EFFECTSOF STRATIFICATION ORGANIZATIONS

SUMMARY AND CONCLUSIONS

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