Using data from the Program for the International Assessment of Adult Competencies, this paper compares the earnings premium and employment share of jobs in Science, Technology, Engineering and Mathematics (STEM) across 11 member countries of the Organisation for Economic Co-operation and Development. The results reveal that the STEM wage premium…

Using data from the Program for the International Assessment of Adult Competencies, this paper compares the earnings premium and employment share of jobs in Science, Technology, Engineering and Mathematics (STEM) across 11 member countries of the Organisation for Economic Co-operation and Development. The results reveal that the STEM wage premium…

We use a random-effects dynamic probit model to estimate the effect of overskilling dynamics on wages. We find that overskilling mismatch is common and more likely among those who have been overskilled in the past. It is also highly persistent, in a manner that is inversely related to educational level. Yet, the wages of university graduates are…

Ample evidence indicates that a person's human capital is important for success on the labor market in terms of both wages and employment prospects. However, unlike the efforts to identify the impact of school attainment on labor-market outcomes, the literature on returns to cognitive skills has not yet provided convincing evidence that the…

It is well established that workers with more years of education earn higher wages. By establishing a reference or "required" level of education for a worker's occupation, it is possible to decompose an individual's actual level of education into years of required education and years of over-education or under-education relative to that…

This study investigates the incidence of over-education amongst recent Australian bachelor degree graduates and its effect on their earnings. We find that between 24% and 37% of graduates were over-educated shortly after course completion, with over-education most common amongst young females and least common amongst older females. Over-education…

Overskilling is the phenomenon whereby a worker's skills are underutilised in his or her job. Overskilled workers are employed, but they are underutilised and mismatched, in that their skills and abilities are not a good match with the requirements of the job. Overskilling can lead to decreased wages and job satisfaction, which suggests that the…

The "OECD Skills Studies" series aims to provide a strategic approach to skills policies. It presents OECD internationally comparable indicators and policy analysis covering issues such as: quality of education and curricula; transitions from school to work; vocational education and training (VET); employment and unemployment; innovative…

In the wake of the technological revolution that began in the last decades of the 20th century, labour market demand for information-processing and other high-level cognitive and interpersonal skills is growing substantially. The "Survey of Adult Skills," a product of the OECD Programme for the International Assessment of Adult…

This paper contributes to the literature by separately analysing the course enrolment and completion effects of vocational education and training (VET) as well as higher education. Moreover, we investigate the persistence of these wage effects over time while controlling for two potential selection biases. We take advantage of the Longitudinal…

This paper presents a comprehensive analysis of the link between age and proficiency in information-processing skills, based on information drawn from the Survey of Adult Skills (PIAAC). The data reveal significant age-related differences in proficiencies, strongly suggesting that proficiency tends to "naturally" decline with age. Age…

This paper reports that between 2008 and 2009, unemployment rates across OECD countries increased among people at all educational levels, but rose to especially troubling heights among people without an upper secondary education. In 2009, the average employment rate across OECD countries was much higher for individuals with a tertiary (i.e.…

Completion rates are an obvious performance indicator for the vocational education and training (VET) sector. Previously published figures indicated overall completion rates as low as 27%. One response to this is the argument that there are many students who do not need to complete their qualification as they acquire the skills they need without…

This paper examines the outcome of over-skilling and over-education on wages and job satisfaction of full-time employees in Australia between 2001 and 2008. We employ a random effects probit model with Mundlak corrections. We find differences by type of mismatch, education pathway, and gender. We categorise reported mismatches as genuine…

This paper employs conditional second moments to identify the impact of education in wage regressions where education is treated as endogenous. This approach avoids the use of instrumental variables in a setting where instruments are frequently not available. We employ this methodology to estimate the returns to schooling for a sample of…