The Impact of Horizontal Job-Education Mismatches on the Earnings of Recent University Graduates in Russia

Abstract

This paper analyses the determinants and consequences of horizontal job-education mismatches, an increasingly relevant topic in debates about education and labour markets. This issue reflects the articulation of educational fields and occupations in the labour market. We evaluate the determinants of job-education mismatches and their impact on salaries of university graduates using comprehensive and representative national data for Russia. The study is based in graduates' assessment and statistical analyses. We find that one-third of graduates in Russia work in a job that is not related to their field of study. Moreover, graduates from fields that either generate more general human capital (social sciences, business, law, services) or where low pay is common (agriculture) are more likely to be in that situation. On the contrary, graduates from fields that generate specific human capital (e.g.: medicine) are considerably more likely to be matched. We find that mismatches negatively affect the earnings of university graduates and the higher the degree of mismatch, the higher the penalty for the mismatch. The study depicts that mismatch is penalized in the majority of fields except for low-paid ones (e.g.: agriculture).

Keywords: job-education mismatch, education-occupation mismatch, horizontal mismatch, graduate salaries, labor market outcomes, human capital

JEL Classification: J24, J30, J31