Inequality of opportunity in the European labour markets: sequential evidence from a national and a pan-European perspective

Individual circumstances like gender, family background, foreign origin, and health limitations significantly shape individual economic opportunities. This paper delves into inequality of opportunity by examining to what extent labor market outcomes in the European Union, such as employment access and earnings distribution, are influenced by these attributes. By using EU Statistics on Income and Living Conditions (2005, 2011, 2019), our country-specific analysis reveals that, on average, 40 per cent of earnings inequality stems from these circumstances, with variations among countries. A pan-European analysis, conducted for the first time, shows even higher opportunity inequality compared to national levels, magnified by the country-of-residence effect. Despite a 15-year downward trend, nearly 60 per cent of pan-European earnings inequality in 2019 was attributed to these predetermined circumstances, underscoring the need for targeted public policies to tackle an unethical form of inequality.