Educational diversity and individual pay: the advantages of combining academic and VET graduates in the workplace

Simone N Tuor Sartore,Uschi Backes-Gellner

doi:10.1186/s40461-020-00099-4

Abstract

This study analyzes how worker pay is related to educational diversity, i.e., diversity in the educational composition of work groups in terms of the different types of vocational and academic education. As previous research shows that various types of diversity have positive effects in the workplace, a positive effect due to ‘educational diversity’ also seems plausible. We provide novel empirical evidence on the relation between the educational diversity of work groups and productivity, or more precisely, individual workers’ pay. Using theoretical considerations drawn from diversity research, we develop hypotheses on the relation between a group’s educational diversity and individual workers’ pay. Drawing on an exceptionally large set of employer-employee data with more than 87,000 employers and 1,200,000 employees, we test our hypotheses and find that the educational diversity of work groups—and thus work groups with workers of different types of vocational and academic education—is positively related to individual workers’ pay. Thus, educational diversity in the form of a combination of academic and Vocational Education and Training (VET) graduates in the workplace seems to be advantageous for the workers involved. Our findings suggest that educational diversity is especially beneficial in groups with high levels of task complexity and shorter organizational tenure.

Highlights

One potential benefit of diverse groups is their wider variety of task-relevant knowledge and skills than is found in homogeneous groups (Lauring and Selmer 2012; van Knippenberg et al 2004)
This study analyzes whether the educational composition of a work group, i.e., different types of Vocational Education and Training (VET) and academic graduates, is related to individual workers’ pay
We find that the educational diversity of work groups is positively related to individual workers’ pay

Summary

Introduction

One potential benefit of diverse groups is their wider variety of task-relevant knowledge and skills than is found in homogeneous groups (Lauring and Selmer 2012; van Knippenberg et al 2004). If a group of workers is highly diverse in its educational composition, workers will likely possess different sets of knowledge that they can share. The few existing studies on educational diversity focus primarily on top management teams. They suggest that extensive organizational benefits accrue from educational diversity (Carpenter 2002; Choi et al 2017; Simons et al 1999). From both the theoretical and empirical viewpoints, whether these organizational benefits suggest benefits for individual team members is less clear

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Results

Conclusion