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Abstract
This paper uses linked Swiss administrative and survey data to examine the relationship between educational mismatch in the labour market and emigration decisions, carrying out the analysis for both Swiss native and previous immigrant workers. In turn, migrants' decisions separate returning home from onward migration to a third country. We find that undereducation is positively associated with the probability of emigration and return to the country of origin. In contrast, the reverse relationship is found between overeducation and emigration, especially among non-European immigrant workers. According to the predictions of the traditional model of migration, based on self-selection, migrants returning home are positively selected relative to migrants emigrating to other countries. We also find that immigrants from a country outside the EU27/EFTA have little incentive to return home and generally accept jobs for which they are mismatched in Switzerland. These results highlight the relevance to understand emigration behaviours in relation to the type of migrant that is most integrated, and productive, in the Swiss market, hence enabling better migration and domestic labour market policy design.
Highlights
In today’s labour market, there are increasing differences between the actual skills of the workforce and the requirements of the economy, as the tasks associated with each occupation change rapidly due to technology, automation, and globalisation among others
A mismatch between a worker’s skills and their job may arise in the form of educational mismatch,1 or/and horizontal mismatch, which refers to a situation where the skills acquired in a specific field or occupation differ from those required by the job carried out
In order to check the consistency of our measure of educational mismatch when studying its link with any forms of emigration, we investigate its predictive power in relation to wages since overeducation has been shown to be associated with a wage penalty in the literature
Summary
Any opinions expressed in this paper are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but IZA takes no institutional policy positions. The IZA Institute of Labor Economics is an independent economic research institute that conducts research in labor economics and offers evidence-based policy advice on labor market issues. Supported by the Deutsche Post Foundation, IZA runs the world’s largest network of economists, whose research aims to provide answers to the global labor market challenges of our time. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author
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