Overeducation, wages and promotions within the firm

Groeneveld, Sandra; Hartog, Joop

doi:10.1016/j.labeco.2003.11.005

Cited by 65 publications

(42 citation statements)

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“…While it has been suggested by Hartog (2000) that in some countries the demand for skills has become more dispersed than supply, which implies a tendency to both over and underqualification, Groeneveld and Hartog (2004) find no direct evidence that employers systematically seek the overqualified in order to obtain higher skills. It moreover seems unlikely that employers require variation in skills at particular qualification levels; they generally expect a high correlation between qualifications, skills, and motivation 4 (with the first of these signalling the others).…”

Section: The Meaning Of Overqualificationmentioning

confidence: 76%

“…Second, OQ could be used by job-seekers as a signalling device for their skills, but perhaps especially as an insurance against jobsearch failure (Büchel, 2001). Against this, at least within a single firm there is limited evidence for overqualification as an individual career investment (Groeneveld and Hartog, 2004), and of course it would be an expensive way of doing things. However, the expansion of education could add to the competitive pressures that people feel, and so encourage them to obtain more education than they absolutely need for their prospective employment.…”

Section: The Meaning Of Overqualificationmentioning

confidence: 99%

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Overqualification: Major or minor mismatch?

Brynin

Longhi

2009

Economics of Education Review

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in ABSTRACTA large empirical literature suggests that a proportion of employees are over-educated (overqualified) for the jobs that they do. It also estimates the impact of this mismatch on wages.The empirical results suggest that having more education than is needed for a job generates a premium relative to the job but at the same time a penalty relative to the qualification. This mismatch is often explained either by variation in skills or by a slow start to career. Both explanations are compatible with human capital theory. We measure the incidence of overqualification in four European countries: Britain, Italy, Germany and Norway at differing educational levels, to show that overqualification is most common at the lower levels where careers tend to be flatter. The inclusion of a measure of computer skills also seems to make little difference to the relationship between overqualification and wages. However, one issue which is important is the degree of voluntarism that is associated with progression through education. Overqualification is traditionally measured through years of education required for the job and years spent in education, but this can be separated into a part that reflects the achievement of certificates and a part that reflects the passage of time. The latter is strongly influenced by individual motivation which determines final choices and by institutional factors which might either enhance or constrain these. We isolate the number of excess years a person spends in education without reaching the next qualification level in order to use this as an instrument for over-education. Our results suggest that the impact of over-qualification on wages is rather small, and becomes even smaller when the excess years spent in education are used as instrument for over-education. Overqualification can on these results never be interpreted as a labour-market choice which provides some sort of human-capital premium.

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Section: The Meaning Of Overqualificationmentioning

confidence: 76%

Section: The Meaning Of Overqualificationmentioning

confidence: 99%

Overqualification: Major or minor mismatch?

Brynin

Longhi

2009

Economics of Education Review

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“…For instance, the standard result is that the wages of the over-(under-)educated are lower (higher) than for the well-matched at the same education level, but higher (lower) than for the well-matched in the same job (Korpi and Tåhlin 2009;Rubb 2003;Verhaest and Omey 2012), although lack of the difference in the effect magnitude and significance was also reported (Tsai 2010). There is some evidence that the overeducated have higher wage growth than the undereducated (Rubb 2006), but this finding is again not universal (Groeneveld and Hartog 2004;Korpi and Tåhlin 2009). years, and not levels, of education. Different directions of the JPI effects can be explained as follows.…”

Section: Conclusion and Discussionmentioning

confidence: 96%

Imbalanced Job Polarization and Skills Mismatch in Europe

Sparreboom

Tarvid

2016

J Labour Market Res

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This paper considers the education of the labour force based on an analysis of trends in and the relationships between job polarization and skills mismatch. Both job polarization and skills mismatch have become topics of increasing interest, but relationships between the two have been relatively neglected in the literature. We argue that the relationship between polarization and skills mismatch is an empirical matter, which we analyse at both the macroeconomic and microeconomic level in European countries. A novel job polarization index (JPI) is proposed to measure imbalanced job polarization. It takes into account not only the change in the share of medium-level jobs, as is typical for measuring pure polarization, but also the imbalance between the change in high-level and low-level jobs. Skills mismatch at macrolevel is measured by a skills mismatch index (SMI), while traditional measures of undereducation and overeducation are used at the microeconomic level. At the macroeconomic level, we estimate a system of two equations, one for each of the country-level variables gauging polarization and mismatch, respectively. Imbalanced job polarization measured Electronic supplementary material The online version of this article (doi:10.1007/s12651-016-0196-y) contains supplementary material, which is available to authorized users.Responsibility for opinions expressed in this paper rests solely with the authors and does not constitute an endorsement by the ILO. by the JPI negatively affects skills mismatch at the macroeconomic level (SMI), but there is no significant reverse effect. Thereafter we consider the microeconomic level and study the determinants of mismatch using multi-level mixed effects logistic models. The effect of imbalanced job polarization on individual-level mismatch was arguably favourable for individuals in non-crisis time, decreasing overeducation risk although also increasing the chances of undereducation, both gauged using the normative measure, but unfavourable during the global financial crisis of 2008-2009 and the following two years.

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“…18 This is a variation of the over-required and under-required (ORU) specification by Hartog 1997; Groeneveld and Hartog 2004, where human capital is measured using required education (namely the mode highest qualification per three digit occupation of employment) denoted here as S R , as well as binary variables to measure over-required S O and under-required S U education.…”

Section: The Econometric Modellingmentioning

confidence: 99%

The over-education of UK immigrants and minority ethnic groups: Evidence from the Labour Force Survey

Lindley

2009

Economics of Education Review

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Abstract:The paper explores the incidence of over and under education and the effect on earnings for immigrants and natives who hold UK qualifications, drawn from the Quarterly Labour Force Survey 1993-2003. The paper also compares earnings penalties associated with over and under education across immigrant and minority ethnic groups for men and women. The results show that compared to native born Whites, Black African, Other Non-White and Indian men are more likely to be over-educated, whilst for women it is Indian and Pakistani/Bangladeshis who are more likely to be over-educated. Estimating earnings equations shows significantly large over-education penalties for South Asian immigrant and native men, as well as White immigrant men, Black women and White UK born women. However, there are large returns to occupational skills for some minority ethnic and immigrant groups, over and above the returns to qualifications. It is suggested that these groups may therefore find it easier to find a suitable job for their UK education level if higher or further education programmes were combined with occupational specific training.

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Overeducation, wages and promotions within the firm

Cited by 65 publications

References 10 publications

Overqualification: Major or minor mismatch?

Overqualification: Major or minor mismatch?

Imbalanced Job Polarization and Skills Mismatch in Europe

The over-education of UK immigrants and minority ethnic groups: Evidence from the Labour Force Survey

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