German University Graduates Research Articles

University-to-work transitions in Germany – do graduate job seekers benefit from migration and work experience?

ABSTRACT This paper investigates the effects of migration and work experience on university-to-work transitions of German university graduates. We use a job search model, signaling and social network theory to discuss different links between the duration of labor market entry, graduate mobility and work experience. We apply event history analyses and make use of administrative social security records to examine whether work experience and pre-study as well as post-study migration accelerates the labor market entry of graduates. Our regression results stress the importance of both mobility and work experience for the length of the transition period. However, whether the effect is beneficial or adverse depends on the type of graduate migration and previous employment.

Employer changes and their effects on wages. Differences between genders and between different types of job mobility among German university graduates

ABSTRACT Changes in wages and other job characteristics during an individual’s career are often the result of job mobility. Using a sample of Bavarian university graduates, this work analyses the effects that employer changes have on men’s and women’s wages. For this, employer changes are grouped into three categories in order to account for different circumstances. Partly in contrast to previous research, the results show significant and positive effects of job mobility, irrespective of gender and of the type of employer change. However, financial returns are lower in case of changes for personal reasons and – at least when absolute instead of relative changes are analysed – for women. This can be explained largely by different circumstances which personal employer changes occur in and which women experience. The results are discussed with respect to the specifics of the German labour market structure and to gender segregation on the labour market.

Work experience and graduate migration: an event history analysis of German data

ABSTRACT Administrative social security records and event history analysis are used to investigate the significance of previous work experience for the migration decision of German university graduates. The regression results suggest that work experience gained previously and while studying in the university region reduces the likelihood of graduates out-migrating, while extra-regional work activity enhances the probability of labour market entry outside the region of study. The size of the effect depends on the type of work experience. The findings point to the importance of knowledge about local labour markets and social networks for graduates’ migration decision at the start of their career.

Frequency of employer changes and their financial return: gender differences amongst German university graduates

Gender differences in the frequency of employer changes and their financial return were examined in a sample of Bavarian university graduates. The search and matching theories were used to develop hypotheses which were then tested against each other. The results show that in the first few years after graduation women change employer more frequently than men. In large part this can be explained by gender differences in labor market structures, in particular the fact that a woman’s first job is less likely to be in a large company, in an executive position or on a permanent contract and women tend to be less satisfied with their first job. After controlling for variance in these factors the coefficient changes sign, indicating that under similar circumstances men change employer more often. Furthermore, both men and women benefit financially from changing employer. The absolute return is higher for men, but as men tend to have a higher starting salary there is no gender difference in the relative return and hence no effect on the gender gap. The results are also discussed in the light of the specifics of the structure of the German labor market.

Does Ignorance of Economic Returns and Costs Explain the Educational Aspiration Gap? Evidence from Representative Survey Experiments

The gap in university enrollment by parental education is large and persistent in many countries. In our representative survey, 74 percent of German university graduates, but only 36 percent of those without a university degree favor a university education for their children. The latter are more likely to underestimate returns and overestimate costs of university. Experimental provision of return and cost information significantly increases educational aspirations. However, it does not close the aspiration gap as university graduates respond even more strongly to the information treatment. Persistent effects in a follow-up survey indicate that participants indeed process and remember the information. Differences in economic preference parameters also cannot account for the educational aspiration gap. Our results cast doubt that ignorance of economic returns and costs explains educational inequality in Germany.

Does Ignorance of Economic Returns and Costs Explain the Educational Aspiration Gap? Evidence from Representative Survey Experiments

The gap in university enrollment by parental education is large and persistent in many countries. In our representative survey, 74 percent of German university graduates, but only 36 percent of those without a university degree favor a university education for their children. The latter are more likely to underestimate returns and overestimate costs of university. Experimental provision of return and cost information significantly increases educational aspirations. However, it does not close the aspiration gap as university graduates respond even more strongly to the information treatment. Persistent effects in a follow-up survey indicate that participants indeed process and remember the information. Differences in economic preference parameters also cannot account for the educational aspiration gap. Our results cast doubt that ignorance of economic returns and costs explains educational inequality in Germany.

The Financial Capacity of German University Graduates to Repay Student Loans

The need for government intervention in higher education may be justified by an underinvestment in higher education due to a capital market failure (Friedman, 1962; Chapman, 2006). Specifically, higher education is costly but banks are unwilling to offer loans to students in the absence of a guarantor because individual private returns to education are uncertain. From an efficiency perspective, there would be efficiency losses without government intervention because talented but financially disadvantaged prospective students would be excluded. From an equity perspective, there would be distributional inequities because people would not have equal access to educational opportunities.

Locations of labor market entry by German university graduates: is (regional) beauty in the eye of the beholder?

We study location choices of German university graduates at labor market entry, relating them to employment opportunities, regional characteristics and graduates’ own geographic roots. About half of the students remain in the university region or return to their home region. In addition, graduates are significantly more likely to move to a region resembling their home region in settlement structure and dialect than to a dissimilar region. This finding, which is robust to controlling for employment opportunities and geographic distance, indicates that graduates prefer employment in regions similar to those where they originally grew up.

You can’t always get what you want: gender differences in job satisfaction of university graduates

Previous literature stressed on the gender differences in job satisfaction and the factors influencing the job satisfaction of men and women. Two rationales are usually provided for the finding that women tend to be relatively more satisfied with their jobs than men although disadvantaged in labour markets: first, women may have relatively lower expectations of career and income, and second, they may attach relatively less importance to extrinsic rewards than men. In order to analyse whether substantial gender differences exist already at the beginning of the career, we employ information of over 20 000 graduates collected through a large-scale survey of German university graduates who recently entered the labour market. We find that the job satisfaction of female graduates is on average slightly lower than the job satisfaction of male graduates, but our results do not point to substantial gender differences. In our sample of highly qualified individuals, men and women are very similar in what they want from their jobs and also in their perceptions of what they get. While our results point to substantial similarity of men and women in the early career stage, gender differences may emerge at later stages of the career life cycle.

What Determines Wage Inequality Among Young German University Graduates?

Summary This paper investigates the gender wage gap among university graduates in their first job and five to six years into their careers using a representative survey among German university graduates. Results from standard decomposition techniques show that up to 83%of an initial 24% earnings disadvantage for women in the first job can be attributed to differences in endowments that are fixed at the time of labor market entry. Of these, fields of study play a dominant role and explain up to 70%of the earnings differential. Adding employer characteristics raises the explained part of the differential to 96%. The importance of unexplained factors increases after five to six years where 40% of the earnings gap remain unexplained even when controlling for detailed experience and employer characteristics.

Here Today, Gone Tomorrow? Regional Labour Mobility of German University Graduates

Krabel S. and Flöther C. Here today, gone tomorrow? Regional labour mobility of German university graduates, Regional Studies. This paper traces university graduates' mobility when entering the labour market after graduation. The empirical analysis utilizes a large-scale, survey-based dataset of individuals who graduated from thirty-six German universities in 2007. It applies a two-stage analysis examining both employability and the likelihood that a graduate will leave the university region after finding a job. Controlling for differences in employability, it is found that characteristics of the university region as well as graduates' contacts with local employers are key determinants of regional mobility when entering the labour market.

Wage differentials by field of study – the case of German university graduates

Using data on German university graduates, this paper analyzes wage differentials by field of study at labor market entry and five to six years later. At both points of time, graduates from arts/humanities have lower average monthly wages compared to other fields. Blinder–Oaxaca decompositions show that these wage differentials can be explained largely by different job and firm characteristics rather than by individual or study-related characteristics. We also find evidence that the less favorable job and firm characteristics of arts/humanities graduates at labor market entry will persist for (at least) the next five to six years.

Wage Differentials by Field of Study – The Case of German University Graduates

Using data on German university graduates, this paper analyzes wage differentials by field of study at labor market entry and five to six years later. At both points in time, graduates from Arts and Humanities have lower average monthly wages compared to other fields of study. Blinder-Oaxaca decompositions show that these wage differentials are generated largely by different job and firm characteristics of graduates rather than individual or study-related characteristics. We also find evidence that the less favorable job and firm characteristics of Arts and Humanities graduates at labor market entry persist for (at least) the next five to six years.

Are We Spending Too Many Years in School? Causal Evidence of the Impact of Shortening Secondary School Duration

In international comparison, German university graduates are elder on average when they enter the labor market. Apart from the longer duration time of study at university, one fundamental reason is the long secondary schooling time. Therefore, almost all of the German federal states have introduced a reform of shortening the length of secondary schooling by one year while holding the curriculum almost constant. Hence, the reform has increased the learning intensity ratio, i.e. the ratio of academic curriculum content per unit of instructional time, for the treated students considerably. The educational policy reform was at first enacted in 2003 and realized in 2007 with a double cohort of graduates in the German state of Saxony-Anhalt. We use this reform as a natural experiment to evaluate the causal effects of higher learning intensity ratios on student performance. Identical final written exams for both cohorts allow us to assess school performance directly. We use achievement grades at graduation in mathematics, German literature and English to approximate the effects on human capital accumulation. The effects of increasing learning intensity ratios on student performance depend on subjects and differ by gender. We find significant negative effects on student performance in mathematics for females and more pronounced negative effects for males. Student performance in foreign language has also decreased due to the reform, but only for females. In contrast to that, no differences are obtained on grades in German literature for both genders. Our findings suggest inefficient learning intensity ratios in the acquisition of linguistic skills. However, increasing the academic content considerably in a predefined period of instructional time in mathematics cannot compensate for shortening schooling time. Moreover, some students are not able to cope with the increase in learning intensity. Perhaps, lowering the learning intensity ratio in such demanding subjects like mathematics by additional instructional time at the expense of subjects with low learning intensity is a reasonable recommendation. In addition, a revision of the curricula could be an appropriate response. Our results suggest that institutional features, such as learning intensity, matter. Policy makers should turn their attention from raising the quantity of education to raising the quality.

Attractiveness of Facial Profiles as Rated by Individuals with Different Levels of Education

The reasons people consult the orthodontist are functional, prophylactic and esthetic in nature, which is why it is important to know (in justifying an intervention for esthetic reasons) what patients themselves find attractive, and whether German university graduates and non-graduates would evaluate the attractiveness of profile views of Class-I, -II and -III patients differently. We also were interested in identifying per group the degree of deviation (from a "normal" skeletal profile) from which the appraisers would judge that profile to be unattractive. A total of five skeletal Class-I patients with straight-average faces (ideal biometric face as defined by A. M. Schwarz 1958) were transformed to reflect three Class-II profile variants and three Class-III profile variants with Onyx Ceph software. Out of the 35 profiles thus obtained we formed two groups of 20 each. Group 1 comprised the five straight-average (biometric) faces and six retrognathic and nine prognathic profile variants. Group 2 comprised the same five straight-average faces and the remaining retrognathic and prognathic profile variants. Both face groups were evaluated by 117 university graduates (65 men and 52 women) and 103 non-graduates (49 men and 54 women) between 23 and 41 years old. The participants were randomly assigned to the two groups. These volunteers were asked to rate the profiles along a scale of 0 (least attractive) to 10 (most attractive). The paper copies with the profiles were assessed in comparison to a single profile that had been classified with an average of 7.6 by ten orthodontists. Both groups of observers perceived the five straight-average faces similarly in the first and second scoring rounds. The straight-average face was perceived as the most attractive by both the university graduates (mean: 5.37; 95% CI: 5.15-5.59) and non-graduates (mean: 5.71; 95% CI: 5.48-5.95), followed immediately by mildly and moderately retrognathic, as well as mildly prognathic profile lines. Both groups perceived extremely prognathic and retrognathic profile lines as the least attractive (mean value for graduates: 4.27; 95% CI: 4.05-4.49; for nongraduates: 4.83; 95% CI: 4.59-5.06), with the university graduates' ratings being significantly lower than those of the nongraduates. Grouping the subjects by gender yielded only minor differences in perception. The straight-average face was perceived as being the most attractive by representative populations in Germany. On the whole, the university graduates were more critical in their ratings than non-graduates.

The Singularity of the German Doctorate as a Signal for Managerial Talent: Causes, Consequences and Future Developments

The paper focuses on signaling options for managerial talent under different higher education regimes. The educational paths in a sample of top managers of the 100 largest publicly traded companies in the U.S., France and Germany are consistent with our theoretical conjectures. For the singular role of the German doctorate, the traditional chair system in doctoral education and training is essential. The effects of higher education reforms are discussed. In Germany the doctorate is a powerful signal for managerial talent. Future signaling options are closely tied to German higher education reform. Key words: Doctoral Education, Signaling, Managerial Talent, German Higher Education, Higher Education Reform 1. Introduction Comparative international studies of top management careers routinely point to the unparalleled percentage of doctoral degree holders among German top managers (e.g. Hartmann 2000). Moreover, empirical studies devoted to the analysis of career perspectives among German university graduates report superior career opportunities for candidates holding a doctoral degree not only in universities and research institutes but also in public administration, politics and in the private sector. The German doctorate is highly valued among employers in various industries (Enders/Bornmann 2001; Baldauf 1998). These findings indicate that the traditional German doctoral education was not exclusively directed at the scientific labor market. Unlike the Ph.D. in the U.S. and the doctorates in many other countries, the German doctoral degree has obviously not been perceived by the labor market as a specialized indicator for research abilities in a certain scientific field. In order to serve as an 'accelerator' for a management career in business and public administration, the German doctoral degree must have been rather understood as an indicator for a more general form of human capital. For reasons of simplicity we will speak of 'managerial talent' when we refer to this kind of general human capital, which enhances the productivity of a candidate in many different employments. The interpretation of the traditional German doctorate as an indicator for managerial talent raises different puzzles: First, which economic mechanisms produce this singular property of the German doctorate as compared to doctoral degrees in other countries? Second, which economic mechanisms substitute for this property of the German doctorate in other countries and third, will this specific property of the German doctorate prevail considering the recent changes and reforms in German higher education? The general role of indicators for human capital has been extensively studied. Employers cannot assess the productivity of potential employees without cost. With time, employers may learn more about the workers' true productivity and subsequently modify the provided employment conditions. However, in many professional services and for higher job levels in general, the productivity of a worker may never become fully observable because labor output depends on multiple and complex exogenous variables. Consequently, employers frequently face a substantial risk of adverse selection in their employment decisions. The negative effects of information asymmetries between employees and employers are not only borne by the latter. Employees are equally concerned, since wages and career options reflect average qualities rather than the applicants' individual endowment. Individuals with an above-average talent have strong incentives to reduce information asymmetries and to actively communicate their superior potential. As Arrow (1973) pointed out higher education, among other things, may function as a filter in this context. Certifying that individuals have 'passed' through specific filter devices, educational credentials could serve as signals for certain aspects of human capital that employers may find valuable. …