Qualification (Mis)Match for Upper Secondary and Higher Education

Mariya Neycheva

doi:10.3390/socsci10090327

Abstract

The expansion of education all over the world is expected to improve economic and social development. However, the oversupply of educated labor force might bring unfavorable consequences for the labor market and long-run growth prospects. In this regard the purpose of this paper is two-fold. First, it aims at summarizing the main channels and mechanisms through which education–job mismatch could impact the changes of per capita income. Second, the study presents empirical evidence on that impact by differentiating between qualification mismatch among workers having completed tertiary education and those with upper secondary education. The sample comprises the EU member countries between 2000 and 2019. The results suggest that whereas the higher percentage of the properly matched labor force increases the steady-state level of per capita output for both educational levels being considered, the effect of qualification mismatch is either negative or insignificant. There is some evidence that overeducation among higher education graduates exhibits a stronger negative effect on economic activity in comparison with overeducation among workers with upper secondary education.

Highlights

The rising educational attainment of the population is accompanied by a rising education–job mismatch in the developed world
As it is clearly visible, in all cases, the rate of qualification mismatch among workers with tertiary education is positively related to gross domestic product (GDP) per capita and statistically significant at the 5% level
One of its contributions is that it differentiates between the macroeconomic impact of qualification mismatch across different educational degrees, tertiary and upper secondary education

Summary

Introduction

The rising educational attainment of the population is accompanied by a rising education–job mismatch in the developed world. In terms of the interrelationships between the labor market and aggregate activity, the tendency that part of the most educated human capital has been moving down the occupational ladder is expected to influence output and per capita income in the long run. Though the fundamental theoretical models relating human capital and economic growth does not explicitly differentiate between the properly matched and mismatched graduates (e.g., Mankiw et al 1992; Lucas 1988; Romer 1986; Islam 1995; Nonneman and Vanhoudt 1996), it is reasonable to expect that they would differ in their impact. The present study, on the one hand, discusses the theoretical channels and mechanisms through which vertical qualification (mis)match might influence aggregate activity and, on the other hand, presents empirical evidence on that influence

Objectives

Methods

Results

Conclusion