The Career Prospects of Overeducated Americans
In this paper we analyze career dynamics for the large share of U.S. workers who have more schooling than their peers in the same occupation. We use data from the NLSY79 combined with the CPS to analyze transitions into and out of overeducated employment, together with the corresponding effects on wages. Overeducation is a fairly persistent phenomenon at the aggregate and individual levels, with 66% of workers remaining overeducated after one year. Overeducation is not only more common, but also more persistent among blacks and low-AFQT individuals. Further, the hazard rate out of overeducation drops by about 60% during the first 5 years spent overeducated. However, the estimation of a mixed proportional hazard model suggests that this is attributable to selection on unobservables rather than true duration dependence. Finally, overeducation is associated with lower current as well as future wages, which points to the existence of scarring effects.
Clement Joubert and Arnaud Maurel gratefully acknowledge financial support from the W.E. Up-john Institute for Employment Research through the Early Career Research Grant No. 13-141-02B. We thank Peter Arcidiacono, Pat Bayer, Donna Gilleskie, Joop Hartog, Lisa Kahn, Francis Kramarz, Sang Yoon (Tim) Lee, Brian McManus, Hessel Oosterbeek, Seth Sanders, Ken Wolpin, Shintaro Yamaguchi and the attendees of the 2013 North American Summer Meeting of the Econometric Society (Los Angeles), the workshop "Empirical Research in the Economics of Education'' (Rovira i Virgili University, Oct. 2013), the workshop"Skill Mismatch: Microeconomic Evidence and Macroeconomic Relevance'' (Mannheim, April 2014), and seminar participants at Duke, John Hopkins and UNC - Chapel Hill for useful comments and suggestions. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.
Brian Clark & Clément Joubert & Arnaud Maurel, 2017. "The career prospects of overeducated Americans," IZA Journal of Labor Economics, vol 6(1). citation courtesy of