Overeducation on the Belgian labour market: evaluation and analysis of the explanatory factors through two types of approaches

Abstract

This paper examines the incidence and determinants of overeducation in the Belgian private sector. Two different approaches are used to define overeducation by means of data on characteristics of employees and employers. Using the 1995 Structure of Earnings Survey, between 22% and 24% of the workforce is found to be overeducated. Results support the idea that employers view labour market experience as a substitute for formal education. They also show that male workers and people employed in state‐owned firms are less affected by overeducation. Further results suggest that the size of the establishment has a very weak (negative) impact on overeducation.