Human Capital and The Labor Market

Adel Alaali
3 min readJul 19, 2022

The labor market is a marketplace where human capital is in exchange between the employer and the prospective employee. Similar to financial assets, the price of acquiring human capital often ebbs with economic, social, and workplace-related flows. However, differing from its financial counterpart, human capital has volition — meaning the employed may leave the firm if they choose to. To hedge against the market inconsistencies, SG Cowen leveraged their parent companies’ healthy balance sheet and posited themselves as an agile boutique investment firm for recent Business Graduate employment opportunity. Additionally, the organization assigned team captains to canvas their alumnus universities for prospective employees. Rather than being HR representatives or corporate recruiters, the canvasers themselves were financial analysts, primarily focused on the health care and technology sectors.

Furthermore, the analysts were dispatched after establishing several years of tenure at SG Cowen, thus ensuring aligned workman values with similar educational backgrounds. Per current workman ranks, the new newly hired intertroop would be recruited from SG Cowen’s core businesses (top 10 business schools.) The first round of interviews would be conducted by the mid-senior associates of SG Cowen, seemingly as an effort to assess the prospective hires ethos in juxtaposition to SG Cowen’s culture. In effect, the hire would better understand organizational norms, and the organization would gather insight as to whether the prospect fits the organization’s culture. Furthermore, to safeguard SG Cowen’s position in the labor market, the recruiters were instructed to hammer out the following points: “who are we, what do we do, what distinguishes us from competitors, and what are the next steps.” The recruiters then would hold second-round interviews, tightening to candidate pool with six ultimately invited to ‘Super Saturday’.

The human capital valuations were based on a candidate’s ability to remain agile in a changing industry and were assessed on leadership, interpersonal and judgment skills. Key elements considered during the hiring process included ascertaining the prospective hirees’ interest in the industry, the candidate’s opening and willingness to accept technological change, and a prudent assessment of the candidate’s decision-making/interpersonal skills.

Several caveats exist within SG Cowen’s recruitment framework. For example, though the organization was capitalizing on its current employee’s relationship with alumni universities, fulfilling its junior rank roles may delve into an initial sound relationship, with similarities intermingled. However, it also limits the overall number of applicants SG Cowen’s associates interviewed. Seemingly so, it is inferred the rank and files educational background is predominately from the top10 colleges and that explicitly expanding the accepted threshold for tiered universities yielded more favorable results.

SG Cowen yielded less than favorable results by focusing recruitment on only the ‘core schools’, as many applicants were primarily from the middle and lower spectra of the graduating class. By only hiring from SG Cowen’s workman ranks, the organization limited itself to fewer business schools and subsequently fewer students. Simultaneously, the population was further limited to the less than stellar students from the queries schools. SG Cowen increased expanding the accepted threshold to the top 15–20 business universities and subsequently realized a better talent pool. Furthermore, it was noted variability existed in the quality of accepted candidates because several recruitment employees were notably generous in their peer assessments. Perhaps the variably could be compounded the interviewees and interviewed scholiastic similarities — a facet easily mitigated by leveraging the human resources department rather than junior and mid-rank associates.