Measuring Transition Smoothness into European Labour Market(s)

High levels of unemployment and labour market mobility characterise the school-to-work (STW) transition process. At empirical level, there are studies that use indices accounting for a time dimension, i.e., the length of transition into first significant job or the length of job search, while others propose more complex tools and indicators in order to capture the level of mobility and/or precarity, which is typical for the SWT phase. In this paper we intend to contribute to the existing literature and design a composite indicator of transition smoothness into the labour market. Several indicators were examined for this reason and after a thorough examination based on correlation and Principal Components Analysis a composite indicator is proposed that considers the transition probability from school to employment, the transition probability from school to unemployment and the employment rates of recent graduates. The composite indicator is validated and evaluated through a correlation analysis regarding other indicators that attempt to measure STW and established indicators of the labour market condition of young individuals in Europe. We also examine whether the crisis has generated convergence or divergence in STW patterns across Europe, by comparing the values of the proposed composite indicator among countries for the year 2008 with the latest at the time available raw data, i.e., for the year 2016, drawn from the EU Labour Force Survey (EU-LFS). The proposed composite indicator of STW transition smoothness is then used in search for patterns among European and within post-socialist countries.