Skill Mismatch and Unemployment in OECD Countries.

This paper uses evidence on employment, labor force, and wage differentials by education from OECD countries to investigate the characteristics and the consequences of a skill-biased shift in the structure of labor demand and supply. The empirical analysis shows that there has been some increase in skill mismatch in a few OECD countries over the past two decades but this has not been a generalized phenomenon. Moreover, the rise in mismatch cannot explain much of the rise in unemployment in continental Europe, while it does explain a significant proportion of the increase in the rate of joblessness in Britain. Copyright 1999 by The London School of Economics and Political Science