Overskilling persists, so getting the right job from the start matters, according to new research released today by the National Centre for Vocational Education Research (NCVER).
The persistence of overskilling and its effects on wages by Kostas Mavromaras, Stephane Mahuteau, Peter Sloane and Zhang Wei examines the persistence of overskilling on school, vocational education and training (VET) and university graduates over several years and its impact on their wages.
It finds that being overskilled is persistent. Individuals who have been overskilled in the three past years are much more likely to currently be in a job where they are overskilled than their peers who have been in jobs where they have made full use of their skills.
However, this difference varies a great deal by education level, with it being 33.4 percentage points for university graduates, and over 50 percentage points for VET diploma and certificate III/IV graduates.
“We find evidence that overskilling can last for years and that it can be a trap similar to long term unemployment. It clearly shows the importance of finding a job that is well-matched to people’s skills”, said Professor Mavromaras, from the National Institute of Labour Studies, at Flinders University.
The impact of overskilling over time on people’s wages is also revealing. Interestingly, it’s university graduates who by far sustain the worst wage losses.
In comparison, the pay of VET graduates is largely unaffected by overskilling, as are the wages of workers who haven’t finished school.
“Put simply, the stakes are higher for university graduates to find the job that best matches their skills, particularly those aspiring to the better paid jobs”, said Professor Mavromaras.
Copies of The persistence of overskilling and its effect on wages are available from www.ncver.edu.au/publications/2471.html
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