How Does the Supply of Tertiary Graduates Correlate with the Labour Market? Evidence from European Countries

Abstract

It is well-known that the education level has significant impact on employment prospects on the labor market. Despite a slight decrease in the number of tertiary graduates in 2018-2019, the year 2020, when the COVID-19 pandemic began, was marked by an increase in the indicator-level. In the long term, the supply of tertiary graduates registered an upward trend. The paper performs - in a note of originality - a cluster analysis of the European countries by the correlation between the evolution of the graduates with higher education and that of the employment rate of the highly qualified, in order to identify the main behavioral patterns. As a novelty element, the paper tests the hypothesis of the existence of statistically significant changes from the perspective of the share of tertiary graduates and that of the employment rate of highly educated, during the current pandemic crisis compared to the previous global financial crisis. The results indicated an important improvement only of the second indicator, which shows the need to develop policies to stimulate the youth to raise their education level, and thus improve the situation on the labor market, even in crisis times.