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Skill Mismatch and Public Policy in OECD Countries

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  • Müge Adalet McGowan

    (OECD)

  • Dan Andrews

    (OECD)

Abstract

This paper explores the relationship between skill mismatch and public policies using micro data for 22 OECD countries from the recent OECD Survey of Adult Skills (PIAAC). Results suggest that differences in skill mismatch across countries are related to differences in public policies. After controlling for individual and job characteristics, well-designed product and labour markets and bankruptcy laws that do not overly penalise business failure are associated with lower skill mismatch. Given the negative relationship between skill mismatch and labour productivity, reducing skill mismatch emerges as a new channel through which well-designed framework policies can boost labour productivity. Skill mismatch is also lower in countries with housing policies that do not impede residential mobility (e.g. transaction costs on buying property and stringent planning regulations). Greater flexibility in wage negotiations and higher participation in lifelong learning as well higher managerial quality are also associated with a better matching of skills to jobs. Inadéquation des compétences et action des pouvoirs publics dans les pays de l'OCDE Ce Document de travail analyse la relation entre inadéquation des compétences et politiques publiques, à l’aide de micro-données recueillies pour 22 pays de l’OCDE à partir de la récente enquête PIAAC (Programme de l’OCDE pour l'évaluation internationale des compétences des adultes). Les résultats donnent à penser que les différences d’inadéquation des compétences d’un pays à l’autre sont le fruit de différences dans l’action des pouvoirs publics. Une fois isolé l’effet des caractéristiques des individus et des emplois, on observe qu’une réglementation des marchés de produits et du travail bien conçue et une législation sur la faillite pas trop pénalisante pour les défaillances d’entreprises vont de pair avec un moindre niveau d’inadéquation des compétences. Compte tenu de la corrélation négative entre l’inadéquation des compétences et la productivité de la main-d’oeuvre, la lutte contre ce phénomène s’offre comme une nouvelle voie par laquelle des politiques publiques bien pensées peuvent susciter des gains de productivité. De même, l’inadéquation des compétences est moindre dans les pays où la politique du logement n’est pas un frein à la mobilité résidentielle (par les coûts de transaction sur les acquisitions immobilières ou la sévérité des règlements d’urbanisme). Enfin, une plus grande marge de manoeuvre dans les négociations salariales, une participation plus forte à l’éducation et la formation tout au long de la vie et une meilleure qualité de la gestion d’entreprise vont également de pair avec une meilleure correspondance entre compétences et emplois.

Suggested Citation

  • Müge Adalet McGowan & Dan Andrews, 2015. "Skill Mismatch and Public Policy in OECD Countries," OECD Economics Department Working Papers 1210, OECD Publishing.
    • Handle: RePEc:oec:ecoaaa:1210-en
    DOI: 10.1787/5js1pzw9lnwk-en
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    More about this item

    Keywords

    allocation of talent; capital humain; distribution des compétences; education; framework policies; human capital; inadéquation des compétences; labour mobility; mobilité de la main-d’oeuvre; politiques-cadres; skills mismatch; éducation;
    All these keywords.

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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