In the context of job applications, letters of reference and testimonials are synonymous words for a document usually written by a professional or educator that is recommending someone for a job and describing their set of skills. However, in business, testimonials can be written by clients to attest to a professional's quality of work or the efficacy of their product or service. Letters of reference and testimonials can be very important and essential to a professional looking for a job or to promote themselves.
When people apply for jobs, their applications can be greatly benefited by having a few well-written recommendations from their references. These are usually referred to as letters of reference, testimonials or letters of recommendation. They are usually written by former employers, former teachers or even coworkers of a high standing. In these letters, the reference will commonly write about the qualities of the particular person, noting how they are well-suited for the job they are applying for and listed this person's various skill sets. While it is not common, some prospecting employers actually require their applicants to draft their own letters of recommendation and then get them signed by a reference. The purpose of this practice is to make possible employees objectively describe their skill sets and qualifications for the job in which they are interested.
In a business context, testimonials can have a different meaning from letters of reference. They are similar, though, in that a former client will recommend someone that gave them business. Testimonials could also refer to certain products or services, where the reference cites how they were satisfied with the product or service and subsequently recommend it.