1. Country Patterns of Labour Market Entry and Early Career Péter Róbert TARKI Social Research Institute, Budapest, Hungary Paper prepared for the DECOWE Conference, Ljubljana, 24-26 September 2009

2. Outline of the presentation Research ambition and questions Conceptual background and hypotheses Data issues: REFLEX and HEGESCO Construction of the measurements Methodology Results on country patterns Discussion and policy relevance

3. Research objective: LM entry and early career Easiness and fastness of LM entry: - length of job search Match between education and current job: - over-education, underemployment - performance gap / credential gap - objective / subjective approach Early career - unemployment experience

4. Conceptual background: OLM / ILM and EPL Internal vs. occupational markets; production vs. training approach; organisational vs. qualificational mobility space - tracking in the school system, vocational specificity, signalling function Employment protection legislation - insider vs. outsider labour market

5. Hypotheses: The effects of OLM / ILM and EPL LM entry is easier and faster under the conditions of OLM due to better signaling function Better match between qualifications and jobs under OLM as the study program is more vocational oriented Stronger EPL makes LM entry more difficult as insiders are better protected Weaker EPL increases the risk of mobility out of first job including the risk of unemployment

6. Data: REFLEX and HEGESCO REFLEX: Fielded in 2005 Covers graduates 5 years after completing university in 1999 /2000 Countries: Austria, France, Belgium, Germany, UK, Netherlands, Norway, Finland, Portugal, Spain, Italy, Estonia, Czech Rep. HEGESCO: Fielded in 2008 / 2009 Covers graduates 5 years after completing university in 2002 /2003 Countries: Slovenia, Poland, Lithuania, Hungary, Turkey Identical questionnaire, same topics

7. Countries: Predicted typology Strict EPLLess strict EPL Less weak EPL Weak EPL OLM (strong signals) Austria, Germany, Slovenia NetherlandsCzech Rep. Poland ILM (weak signals) LithuaniaBelgium, France, Spain, Estonia Finland, Norway UK, Hungary Southern Europe Italy, Portugal, Turkey

8. Dimensions and indicators Labour market entry - Job search lasted longer than 6 months Match between qualification and current job - Working in a job that does not require diploma (based on ISCO title) - Feels that working in a job that requires a level of schooling below tertiary education - Feels that his/her skills are underutilized in current job Early career - Experienced unemployment at least one time

9. Methodology: Cluster analysis An explorative technique to display country patterns based on typical combination of characteristics (= input indicators: see above) Analysis is performed on country level data (N = 18) Dendogram: the process how countries that are more similar (closer to each other) are grouped together Selected cluster solution: countries are grouped and characterized by the indicators that served as input variables for the method

10. Dendogram from cluster analysis

11. Cluster solution: Cluster 1 CountryJob search Unemploy ment exp. Underemp loyed Job does not need a diploma Skills are underutiliz ed Norway52119318 Estonia52317225 Finland63328522 Netherlan ds 32529728 Portugal114220812

12. Cluster solution: Cluster 2 CountryJob search Unemploy ment exp. Underemp loyed Job does not need a diploma Skills are underutiliz ed Austria63861024 France83621326 Germany93515727 Belgium73527228 Czech Rep.53621432 Poland94211430 Slovenia122923828 Lithuania63425738

13. Cluster solution: Cluster 3-4 CountryJob search Unemploy ment exp. Underemp loyed Job does not need a diploma Skills are underutiliz ed Italy1235301230 UK1134401432 Hungary1741391529 Turkey3054301129 Spain2162631732

14. Discussion: Limitations Selection effect: only those analyzed who entered the labour market Conceptual background has been developed and tested earlier for the entire population of LM entrants and not only for graduates Indicators were carefully selected but a wider range of them can only be applied if dimensions analyzed separately

15. Discussion: Lessons Returns to human capital are not homogeneous in the various societies, institutional differences reshape labour market entry and early career of graduates OLM / ILM and EPL turned out to be relevant for a large number of countries in the case of several indicators Country differences are not solely along the lines of former political regimes - the major added value of the HEGESCO project is that including further new EU member states makes clear the existing variation among them - similarly large distance between Estonia and Hungary, and Norway and Spain.

16. Discussion: Policy implications Governments: - Further increase of internationalizing the national higher education system in terms of study programs, methods, international contacts is crucial requirement Employers: - Collecting more information about study programs → Increasing the signaling function of education despite of the expansion at tertiary level → Decrease of underemployment Universities: - Strengthening professional expertise with practical orientation - Increasing collaboration with employers → better signaling function of education → helping decreasing search costs of employers and making easier the LM entry for the students

17. Thank you! Péter Róbert TARKI Social Research Institute Budaorsi ut 45 1112. Budapest, Hungary E-mail: robert@tarki.hu