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Horizontal mismatch and vocational education

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  • Juerg Schweri
  • Annina Eymann
  • Manuel Aepli

Abstract

Recent literature suggests that vocational education and training (VET) provides individuals with smoother transitions into the labour market but lower wages over the lifecycle, compared to general education. A possible mechanism explaining lower wages is horizontal mismatch, defined as a mismatch between the type of qualifications acquired by individuals and those required for their current job. Some studies have found higher mismatch wage penalties when individuals’ education is more specific, suggesting higher penalties for workers with VET. Therefore, we analyse horizontal mismatch in Switzerland, the country with the highest proportion of firm-based VET in the OECD. We use two measures from the Swiss Household Panel that cover different aspects of horizontal mismatch. While we find sizable mismatch wage penalties in OLS estimations, effects are small or insignificant in fixed-effects regressions. This holds for workers with vocational and general education background alike. We conclude that VET is more transferable than often assumed. We finish with recommendations on concept and methods for future analyses of horizontal mismatch.

Suggested Citation

  • Juerg Schweri & Annina Eymann & Manuel Aepli, 2020. "Horizontal mismatch and vocational education," Applied Economics, Taylor & Francis Journals, vol. 52(32), pages 3464-3478, June.
    • Handle: RePEc:taf:applec:v:52:y:2020:i:32:p:3464-3478
    DOI: 10.1080/00036846.2020.1713292
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    Cited by:

    1. Bernd-Joachim Ertelt & Andreas Frey & Melanie Hochmuth & Jean-Jacques Ruppert & Silke Seyffer, 2021. "Apprenticeships as a Unique Shaping Field for the Development of an Individual Future-Oriented “Vocationality”," Sustainability, MDPI, vol. 13(4), pages 1-14, February.
    2. Uschi Backes-Gellner & Patrick Lehnert, 2021. "The Contribution of Vocational Education and Training to Innovation and Growth," Economics of Education Working Paper Series 0177, University of Zurich, Department of Business Administration (IBW).
    3. Amanda Chuan & Christian Lyhne Ibsen, 2022. "Skills for the Future? A Life Cycle Perspective on Systems of Vocational Education and Training," ILR Review, Cornell University, ILR School, vol. 75(3), pages 638-664, May.
    4. Irene Kriesi & Juerg Schweri, 2019. "Types of Education, Achievement and Labour Market Integration over the Life Course," Social Inclusion, Cogitatio Press, vol. 7(3), pages 58-64.
    5. Uschi Backes-Gellner & Patrick Lehnert, 2022. "Apprenticeships," Economics of Education Working Paper Series 0194, University of Zurich, Department of Business Administration (IBW).
    6. Mahmoud Arayssi & Ali Fakih & Nathir Haimoun, 2023. "Skill Mismatch, Nepotism, Job Satisfaction, and Young Females in the MENA Region," Econometrics, MDPI, vol. 11(2), pages 1-20, June.
    7. Aepli, Manuel, 2019. "Technological change and occupation mobility: A task-based approach to horizontal mismatch," GLO Discussion Paper Series 361, Global Labor Organization (GLO).

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    More about this item

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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