New digital and artificial intelligence technologies are fast reshaping skill requirements in the EU labour market, fostering skill mismatches. There are marked concerns about the potentially adverse consequences of automation and AI on employment, as well as the lagging competitiveness of EU...

Since the 1990s, the Czech Republic has witnessed a significant increase in educational attainment, leading to a rise in educational mismatch. This study investigates the prevalence of vertical and horizontal educational mismatch using data from surveys conducted in 2011 and 2022 on Czech prime...

In this paper, we develop a small open economy model of secular stagnation that allows for both unemployment and underemployment. While unemployment results from the standard search and matching friction, underemployment in the form of an involuntary shortfall of working hours occurs under...

We evaluate the effectiveness of Belgium's short-time work (STW) program during the Great Recession, a period when the country recorded the highest STW take-up rate in Europe. STW allows firms to reduce working hours in response to temporary shocks while avoiding layoffs, playing a key role in...

This paper examines vertical skills mismatch in Türkiye using a refined measure that adjusts for occupation, age group, sector, and year to isolate genuine education-job misalignment from compositional artifacts. Drawing on nationally representative labor force survey microdata from 2009 to...

How does being over- or underqualified at the beginning of a worker's career affect skill acquisition, retention, and promotion? Despite the importance of mismatch for the labor market, self-selection into jobs has made estimating these effects difficult. We overcome endogeneity concerns in the...

We study two first‐order economic consequences of vertical mismatch, using a simple (neoclassical) model of under and overemployment. Individuals of high type can perform both skilled and unskilled jobs, but only a fraction of low‐type workers can perform skilled jobs. People have different...

This article proposes a measure of educational mismatch based on a novel definition of schooling that takes into account the different levels of skills acquired by individuals with the same education. It is assumed that less (more) able individuals could compensate for their skill deficit...

Little attention has been paid to supply- and demand-side factors explaining regional variation in youth overeducation. These factors might be drivers of a crowding out effect, where workers at a given level of education are expelled from their "matched" labour market positions by workers with a...

This seventh edition of the European Employment Services (EURES) report on labour market imbalances explores the current status of labour shortages and surpluses and how they have developed over time. Since the first report, published in 2016, the methodology for identifying labour shortages and...

This seventh edition of the European Employment Services (EURES) report on labour market imbalances explores the current status of labour shortages and surpluses and how they have developed over time. Since the first report, published in 2016, the methodology for identifying labour shortages and...

During the Covid-19 crisis, most OECD countries used short-time work (subsidized reductions in working hours) to preserve employment. This paper documents that short-time work affects the behavior of firms (supply) and households (demand). First, using household survey data from Germany, we show...

Short-time work (STW) has been widely used, both during the Great Recession and the COVID crisis, to preserve jobs. In most European countries, the implementation of STW schemes is often the result of bargaining between trade unions and employers, yet very little is known about the role of...

We investigate how firms adjust to demand shocks when wages and employment determination are regulated. Using firm-level data for the Italian metal engineering industry from 2009 to 2021, we estimate the elasticity of the wage bill to changes in firm's real sales. We disentangle the effect on...

This seventh edition of the European Employment Services (EURES) report on labour market imbalances explores the current status of labour shortages and surpluses and how they have developed over time. Since the first report, published in 2016, the methodology for identifying labour shortages and...

This seventh edition of the European Employment Services (EURES) report on labour market imbalances explores the current status of labour shortages and surpluses and how they have developed over time. Since the first report, published in 2016, the methodology for identifying labour shortages and...

Drawing on its rich country-level skills intelligence, Cedefop develops its Spotlights on jobs and skills for EU-27 Member States, Iceland and Norway. The Spotlights provide insights into the current labour market landscape, future trends, and skills anticipation in each country. The analysis is...

We estimate the effects of being over- or underqualified for a job using quasi-random assignment of new enlistees to over 130 different jobs in the US Air Force. Being overqualified causes higher attrition, both during technical training and afterward when individuals are working in their...

Exploiting the quasi-experimental introduction of tuition fees in selected federal states of Germany between 2006 and 2014, this study investigates how these fees affect the likelihood of overeducation based on data from the SOEP. Reporting lower bound estimates, the findings show that graduates...

Cognizant of the persistent concerns about the lack of alignment of skills and education with industry and occupation needs, this paper investigates returns to professional licenses alongside education-occupation matching. It also analyzes the effects of individual and higher education...

The sixth edition of the EURES report on labour market imbalances explores the current status of labour shortages and surpluses and how they have evolved over time. Since the first report, published in 2016, much of the methodology for identifying labour shortages and surpluses has remained...

Governments use short-time work (STW) schemes to subsidize job preservation during crises. We study the take-up of STW and its effects on worker outcomes and firm behavior using German administrative data from 2009 to 2021. Establishments utilizing STW tend to have higher wages, be larger, and...

A large body of literature shows that first-generation immigrants born in developing countries experience a higher likelihood of being overeducated than natives (i.e. immigrant overeducation). However, evidence is remarkably scarce when it comes to the overeducation of second-generation...

Having highly educated workers can be beneficial for organizations in terms of innovation and problem-solving capabilities, however when underpaid and underemployed, overeducated workers may experience feelings of frustration and stagnation as they are unable to fully utilize their skills and...

I study the ramifications of the German short-time work (STW) scheme using novel administrative data on STW and drawing on evidence from establishment surveys that are linked to the administrative data. I show that, besides financial reasons, firms value and use STW because it allows them to...

This article provides an overview of the economic literature on short-time work. It presents the main characteristics of short-time work since its emergence in Germany in the 1930s. It analyzes its effectiveness as a job preservation mechanism, drawing on theoretical models and empirical...

During the Covid-19 crisis, most OECD countries used short-time work (subsidized reductions in working hours) to preserve employment. This paper documents that short-time work affects the behavior of firms (supply) and households (demand). First, using household survey data from Germany, we show...