Employment Effects of Skills Around the World: Evidence from PIAAC

35 Pages Posted: 12 Oct 2016 Last revised: 17 Sep 2019

See all articles by Damir Stijepic

Damir Stijepic

Johannes Gutenberg University Mainz

Date Written: September 11, 2019


Making use of an international survey that directly assesses the participants’ cognitive skills, I study the effect of skills on employment in 32 countries. On average, a one-standard-deviation increase in numeracy skills is associated with an 8.4 percentage-point increase in the probability of being employed, reducing the probability of being out of the labor force and the probability of being unemployed by 6.4 percentage points and 2.1 percentage points, respectively. After controlling for numeracy skills, the estimated employment effect of years spent in education falls by one-third from 2.7 percentage points to 1.8 percentage points. There is considerable heterogeneity across subgroups and countries. Notably, the estimated employment effect of skills tends to be more pronounced in countries with higher unemployment.

Keywords: cognitive skills, education, labor market, employment, international comparisons, Survey of Adult Skills, PIAAC

JEL Classification: J20, J24, J60, J64, I20

Suggested Citation

Stijepic, Damir, Employment Effects of Skills Around the World: Evidence from PIAAC (September 11, 2019). Available at SSRN: https://ssrn.com/abstract=2850550 or http://dx.doi.org/10.2139/ssrn.2850550

Damir Stijepic (Contact Author)

Johannes Gutenberg University Mainz ( email )

Jakob-Welder-Weg 9
Mainz, 55128

HOME PAGE: http://www.damir.stijepic.com

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