Good Skills in Bad Times: Cyclical Skill Mismatch and the Long-Term Effects of Graduating in a Recession
By Kai Liu, Kjell G. Salvanes, Erik Ø. Sørensen. Social Science Research Network, 2016
191 citations recorded by the source corpus.
We show that cyclical skill mismatch, defined as mismatch between the skills supplied by college graduates and skills demanded by hiring industries, is an important mechanism behind persistent career loss from graduating in recessions. Using Norwegian data, we find a strong countercyclical pattern of skill mismatch among college graduates. Initial labor market conditions have a declining but persistent effect on the probability of mismatch early in their careers. We provide a simple model of industry mobility that is consistent with our empirical findings. The initially mismatched graduates are also more vulnerable to business cycle variations at the time of graduation.
Subfields: Demography, Economics and Econometrics
View Paper: https://www.semanticscholar.org/paper/148f4a4eea0aa9c1fcb0f4217fc912c99e818d71
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Citations in the corpus
- Youth unemployment and active labor market policies in Europe (2016, background): “In particular, skill or qualification mismatch is likely to reduce the quality and stability of initially accepted jobs (Wolbers, 2003), with potentially long-lasting negative effects of later-life labor market outcomes (Liu, Salvanes, and Sørensen, 2012).”
- Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis (2020, unknown): “5See Card (2009), Ottaviano and Peri (2012), Aydemir and Borjas (2011), Dustmann and Preston (2012), Borjas (2003) and Borjas and Katz (2007) 6In this case I can also use an adapted version of the immigration network instrument.”
- The Persistent Effects of Initial Labor Market Conditions for Young Adults and Their Sources (2020, background): “…(Brunner and Kuhn 2014), Spain (Fernandez-Kranz and Rodriguez-Planas 2018), Blegium (Cockx and Ghirelli 2015) and Norway (Raum and Roed 2006, 21 Liu et al. 2016, Haaland 2018), an, among others.7 In some countries with a rigid wage structure, there are stronger effects on the probability of…”