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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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    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. Peter Skott, 2006. "Wage inequality and overeducation in a model with efficiency wages," Canadian Journal of Economics, Canadian Economics Association, vol. 39(1), pages 94-123, February.
    3. 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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