This thinking certainly applies to search. This year, Google introduced authorship markup, which helps Google associate various content from a person with that person in search results, and ultimately gets that person's profile prominence in Google search results. If you ever see a little image of a person off to the side of a search result, which is clickable (leading to that person's profile), this is likely what you're seeing.
It's good for authors to gain exposure, and it helps readers establish some level of trust by simply knowing where a result is coming from (regardless of whether or not they actually trust any specific author). In fact, Google is so concerned about this, it doesn't even want authors to have profile pictures that are the least bit unprofessional. For example, I know a guy who was using a picture of himself in his Halloween costume for his profile picture, and a Googler actually contacted him and asked him to change it. There was nothing bad about the picture, they just wanted a regular picture of him for his profile pic, presumably so people wouldn't see anything goofy in the search results, and hurt the perception of Google's rankings, even if the content it showed up next to was perfectly legitimate.
Google recently posted a pair of videos explaining how to implement authorship markup, if you need a bit of guidance:
It would appear that Google considers how many people have you in Circle on Google+ to be some indication of who you are now.
The Next Web says an unnamed source confirmed that the next step of Authorship Markup is to show the number of Circles you're in on the search results pages. You can already see it in action for some people.
This actually makes the whole Circle limit thing a little more interesting. If you can only have so many people in your Circles on Google+, you're not going to want to add just anybody right? In an article this week, we called for Google to get rid of Circle limits because it limits our access to information through Google+, but is this the mindset Google has here?
The bigger names on the web are going to have more connections, so if they can't put every one of them into a Circle, they're only going to want to put their top connections in there. I don't know if this is the way Google is looking at things, but it raises an interesting point, especially with the attention that Klout has been getting (and now its new competitor Kred).
While we don't know that the number of Circles you are in is a search ranking signal, it seems very likely. Remember, when Google was talking about authorship markup, they said they want to "get information on credibility of authors from all kinds of sources, and eventually use it in ranking." It seems pretty logical that circle count could play a role.
If I'm wanting to get more Google search respect, I'm trying to get in more Circles.