Labour Market Under-Utilisation of Recent Higher Education Graduates: New Australian Panel Evidence
Recent research into the Australian labour market has reported that a substantial proportion of the tertiary-educated labour force is under-utilised relative to their level of education, echoing findings from an expanding international literature. This paper uses recent panel data from the 2010 Beyond Graduation Survey to analyse the incidence of labour force under-utilisation amongst recent Australian graduates and its effect on their wages, with an under-utilised graduate defined as a one who is in a job for which a sub-degree qualification would suffice. We find that 26% of graduates were under-utilised immediately after course completion and 15% were under-utilised three years later, although this varied considerably between subgroups. Recent graduates were much more likely to remain under-utilised than become under-utilised later in their careers. Being under-utilised appears to affect the earnings of different graduate age groups in different ways. Controlling for unobserved heterogeneity, we find that younger graduates tend to earn the same mean wages regardless of whether or not they are under-utilised, while older under-utilised bachelor degree graduates are at a significant wage disadvantage relative to their peers. This is suggestive of a graduate skills surplus and, by extension, inefficient public and individual investment in human capital.
|Date of creation:||Oct 2011|
|Date of revision:|
|Publication status:||published in: Economics of Education Review, 2013, 32, 207-218|
|Contact details of provider:|| Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany|
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
|Order Information:|| Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Parvinder Kler, 2005. "Graduate overeducation in Australia: A comparison of the mean and objective methods," Education Economics, Taylor & Francis Journals, vol. 13(1), pages 47-72.
- Parvinder Kler, 2007. "A panel data investigation into over-education among tertiary educated Australian immigrants," Journal of Economic Studies, Emerald Group Publishing, vol. 34(3), pages 179-193, September.
- P. J. Sloane & H. Battu & P. T. Seaman, 1999. "Overeducation, undereducation and the British labour market," Applied Economics, Taylor & Francis Journals, vol. 31(11), pages 1437-1453.
- Piracha, Matloob & Tani, Massimiliano & Vadean, Florin, 2010.
"Immigrant Over- and Under-education: The Role of Home Country Labour Market Experience,"
IZA Discussion Papers
5302, Institute for the Study of Labor (IZA).
- Matloob Piracha & Massimiliano Tani & Florin Vadean, 2012. "Immigrant over- and under-education: the role of home country labour market experience," IZA Journal of Migration, Springer, vol. 1(1), pages 1-21, December.
- Matloob Piracha & Massimiliano Tani & Florin Vadean, 2010. "Immigrant Over- and Under-education: The Role of Home Country Labour Market Experience," CEIS Research Paper 175, Tor Vergata University, CEIS, revised 09 Dec 2010.
- Matloob Piracha & Massimiliano Tani & Florin Vadean, 2011. "Immigrant Over- and Under-education: The Role of Home Country Labour Market Experience," Studies in Economics 1105, School of Economics, University of Kent.
- P. J. Sloane & H. Battu & P. T. Seaman, 1996. "Overeducation and the formal education/experience and training trade-off," Applied Economics Letters, Taylor & Francis Journals, vol. 3(8), pages 511-515.
- Duncan, Greg J. & Hoffman, Saul D., 1981. "The incidence and wage effects of overeducation," Economics of Education Review, Elsevier, vol. 1(1), pages 75-86, February.
- Mavromaras, Kostas & McGuinness, Seamus & O?Leary, Nigel & Sloane, Peter & Fok, Yin King, 2009. "Job Mismatches and Labour Market Outcomes," Papers WP314, Economic and Social Research Institute (ESRI).
When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp6047. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak)
If references are entirely missing, you can add them using this form.