Human Resource Flow within Software Industry: A Firm-Level Investigation

In a knowledge-intensive industry such as information technology, human resource management plays a central role in the success of software firms. This study takes a firm-level analysis and examines the effects of the human resource inflows and outflows on software firm performance. Moreover, we investigate how the specific human capital variables (e.g. education, experience) embedded in the human resource flows affect firm performance. We collect a unique dataset from LinkedIn.com for the human resource flows and human capitals embedded. Our analysis shows that the human resource outflow but not inflow has significant impacts on firm performance. Meanwhile, the human capital variables such as education level and IT experience embedded in the human resource inflow have significant impacts on firm performance. Our study contributes to the research on IT turnover and IT human resource management by highlighting the importance of human capital embedded in the human resource flows. Our findings also suggest that researchers and practitioners should not only focus on the human resource inflow and outflow (i.e., quantity of the human resource flow), but also need to pay attention to the specific human capitals embedded in the flows (i.e., quality of the human resource flow).