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Labour market tightness and matching efficiency in different labour market segments – do differences in education and occupation matter?

Author

Listed:
  • Alka Obadić

    (Faculty of Economics and Business, University of Zagreb)

  • Viktor Viljevac

    (Faculty of Economics and Business, University of Zagreb)

Abstract

This paper analyses the existing educational and occupational structures of several EU member countries and their alignment with the needs of the labour market. Such a situation may indicate a structural mismatch in labour market in which the mismatch between the skills taught in schools and universities and the skills needed in the workplace appears. To evaluate this mismatch, the paper investigates the matching needs of employers and unemployed job seekers by disaggregating the registered employment office data by education and occupation groups in selected EU countries separately. More educated workers, as well as workers in more complex and better-paid occupations, might fare better when it comes to the aggregate labour market trends. For example, economic downturns and increases in unemployment might be felt more heavily by workers with lower education and those who work in professions requiring fewer skills. In this paper, we analyse the data for a selected group of countries (Austria, Croatia, Estonia, Slovenia, and Spain) from 2010 till 2022, using the Beveridge curves and estimate the labour market tightness and matching efficiency for different education and occupation groups. Our results show that differences in education levels and occupation result in relatively small deviations from aggregate trends in the labour market. Aggregate labour market trends therefore strongly impact all groups in the labour market, whether the market is segmented by education levels or by occupation. In other words, both the improvements in the labour market conditions and the worsening of labour market conditions have similar effects across different labour market segments.

Suggested Citation

  • Alka Obadić & Viktor Viljevac, 2023. "Labour market tightness and matching efficiency in different labour market segments – do differences in education and occupation matter?," EFZG Working Papers Series 2303, Faculty of Economics and Business, University of Zagreb.
    • Handle: RePEc:zag:wpaper:2303
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    References listed on IDEAS

    as
    1. Blanchard, Olivier Jean & Diamond, Peter, 1992. "The Flow Approach to Labor Markets," American Economic Review, American Economic Association, vol. 82(2), pages 354-359, May.
    2. Thomas Bolli & Maria Esther Oswald‐Egg & Ladina Rageth, 2021. "Meet the need – the role of vocational education and training for the youth labour market," Kyklos, Wiley Blackwell, vol. 74(3), pages 321-348, August.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    educational structure; structural unemployment; Beveridge curve; matching efficiency; labour market tightness; EU;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs

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