The displacement argument is the dominant explanation for the phenomenon of trained individuals out-qualifying the less educated in job competition. Decreasing employment opportunities are seen as a labour-market matching problem.The explanation given in this paper is'stigmatizationby negative selection'. It takes into account that educational expansion has not only changed the number of less-educated people, but also the 'quality' of the less-educated group^due to changes in its group composition caused by increasing selection in the educational system, employers' perceptions, and ultimately employers' human resource management of this group. Thus, shrinking employment opportunitities for less-educated people are not only derived from distributional but behavioural changes.Whereas the displacement argument is mainly based on labour-market disequilibrium in terms of quantity, the'stigmabyselection'argumentconsiders qualitative changes in this relationship between individuals and their environment. The ranking process is expanded into a 'sorting-out' process for the less-educated group which begins in school. The main argument is that following educational expansion, employers increasingly trust the sorting function of schools and teachers' evaluation, resulting in an exclusion of the less well educated.The empirical ¢ndings based onWest German data correspond to the theoretical reasoning of the 'stigma by selection'argument.

This article explains the different extent of economic marginalization of low-educated persons in different countries. Research on economic marginalization mainly studies the so-called displacement mechanism: the higher the high-skill supply is in relation to the high-skill demand, the higher is the risk of being unemployed for low-educated workers. In this article, we examine their economic marginalization in terms of status position. This research expands the explanation of economic marginalization of low-educated workers by scrutinizing additional causes, such as negative social selection, negative cognitive competence selection, and the increasing negative signal of being low educated (discredit). The results of the country comparison, using multilevel estimation techniques with inclusion of cross-level interactions, depict that, indeed, educational differences in socio-economic status attainment are larger in countries where the average competence of the group is low, the social composition is unfavourable, and the size of the low-educated group is relatively small. By considering these additional explanations, we are now better able to understand the economic vulnerability of low-educated people in educationally expanded countries.

No abstract