Overeducation in Europe: differences between native and immigrant older workers

Abstract

Overeducation does not permit to affected workers to fully exploit their previous investments in acquiring knowledge and competencies, leading to a loss of efficiency for them and for the labour market. This research aims at empirically studying the likelihood of being overeducated among 50+ years old workers in Europe during the period 2004-2020, separating the effects between native and immigrant workers. Data are obtained from SHARE, which is a longitudinal cross-national panel database covering 20 European countries and Israel. Our sample includes workers, native and immigrants who are citizens of the country of residence, implying a higher level of personal and labour integration in the arrival country. Two models are estimated to account for the socioeconomic and personal factors that strongly influence a worker's likelihood of being overeducated. Specifically, it examines whether immigration background raises the probability of overeducation and whether time spent in the country of arrival facilitates the process of overcoming that. Results show that adult immigrant workers are more likely than native-born people to be overeducated, with immigrant women being significantly affected. Time spent in the labour market is crucial for reducing the persistence of overeducation and allowing workers to move into jobs more aligned with their school attainments; however, some immigrant workers are not able to get out of the overeducation trap.