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Qualifications and the Labour Market in Britain: 1984-1994 Skill Biased Change in the Demand for Labour or Credentialism?

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  • Marco Manacorda
  • Peter Robinson

Abstract

The paper looks at the change in the occupational and educational structure of employment in Britain over the period 1984 94. It shows that changes in the occupational structure of employment can only explain a modest part of the increase in the holding of qualifications by the employed workforce. On the other hand, the increase in the proportion of the workforce with different qualifications over the period 1984 94 can predict with remarkable accuracy the structure of the occupations by qualification in 1994, implying that the increased holding of qualifications by each successive age group simply results in employers of each occupation upping their educational requirements as would be suggested by the credentialist hypothesis. The predictability of this process argues against an interpretation based on skill biased changes in the demand for labour, which would be expected to have a differential impact across occupations. These are stark conclusions, suggesting that the outputs of the education and training system in Britain over the period 1984 94 did not merely keep pace with labour market changes, but allowed employers to hire more qualified people for what in the data look like essentially the same jobs.

Suggested Citation

  • Marco Manacorda & Peter Robinson, 1997. "Qualifications and the Labour Market in Britain: 1984-1994 Skill Biased Change in the Demand for Labour or Credentialism?," CEP Discussion Papers dp0330, Centre for Economic Performance, LSE.
    • Handle: RePEc:cep:cepdps:dp0330
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    Citations

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    Cited by:

    1. Skott, Peter, 2005. "Fairness as a source of hysteresis in employment and relative wages," Journal of Economic Behavior & Organization, Elsevier, vol. 57(3), pages 305-331, July.
    2. Jenkins, Andrew, 2001. "Companies use of psychometric testing and the changing demand for skills: a review of the literature," LSE Research Online Documents on Economics 19541, London School of Economics and Political Science, LSE Library.
    3. Kölling, Arnd & Schank, Thorsten, 2002. "Skill-biased technological change, international trade and the wage structure," Discussion Papers 14, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
    4. Fabrice Collard & Raquel Fonseca & Rafael Munoz, 2002. "Spanish Unemployment Persistence and the Ladder Effect," CEP Discussion Papers dp0538, Centre for Economic Performance, LSE.
    5. David R. Howell & Margaret Duncan & Bennett Harrison, 1998. "Low Wages in the US and High Unemployment in Europe: A Critical Assessment of the Conventional Wisdom," SCEPA working paper series. 1998-01, Schwartz Center for Economic Policy Analysis (SCEPA), The New School, revised Aug 1998.
    6. Kaiser, Ulrich, 1998. "The Impact of New Technologies on the Demand for Heterogenous Labour: Empirical Evidence from the German Business-Related Services Sector," ZEW Discussion Papers 98-26, ZEW - Leibniz Centre for European Economic Research.
    7. Peter Skott, 2006. "Wage inequality and overeducation in a model with efficiency wages," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 39(1), pages 94-123, February.
    8. Skott, Peter & Auerbach, Paul, 2003. "Wage inequality and skill asymmetries," Economics Discussion Papers 2003-7, School of Economics, Kingston University London.

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