Immigrant overeducation: Evidence from recent arrivals to Australia

Abstract

Australian immigration policy, in common with the US and Canada, has increased the emphasis on skill based selection criteria. A key premise of this policy is that skilled immigrants are more employable and can add to the productive capacity of the economy. However, this e¤ect will be diminished if immigrants are working in occupations that fail to utilise their skills. We examine the extent of overeducation for recently arrived immigrants to Australia. We …nd that they are more likely to be overeducated than the native population, even if they enter on skill based visas.Overeducation is greatest for immigrants from Non-English speaking backgrounds (NESB) and appears to generate lower returns to education. The incidence of overeducation is signi…cantly reduced for all immigrants if they enter with visas that are a result of a job o¤er from an employer in the recipient country.

Social networks and the labour market mismatch

“…Within the over-education literature, three main methods have been proposed to measure over-education: the job analysis method (JA), worker selfassessment (WA) and the realised matches method (RM). The job analysis method is seen as the objective measure that relies on documents and formal studies by countries and organisations, which is therefore often considered the preferred method to measure educational mismatch (Rumberger, 1987;Green et al, 2007;Hartog, 2000). For this study, the job analysis method is therefore used to estimate the dependent variable, the probability of being over-educated.…”

Immigrant over- and under-education: the role of home country labour market experience

“…For instance, Chiswick and Miller (2008); 2009, for analyses of Australia and the US, argue that the main reason for immigrant education mismatch is the less than perfect human capital transferability across borders, especially for those who migrate from less developed countries and/or those who have low host country language skills. Similarly, Green et al (2007) use the LSIA to show that immigrants in Australia are much more likely to be over-educated than the natives and the difference is more pronounced for those coming from non-English speaking backgrounds. One other explanation put forward by Battu and Sloane (2004) is the possible discrimination against non-whites in the UK labour market, where they compare mismatch for ethnic minorities with those for white natives 7 .…”

“…Under this approach an individual is considered over-or under-educated if his education level is, respectively, one standard deviation above or below the mean education level required for that particular job. A third way to analyse the level of over-/under-education is the "objective" measure based on methods used by different countries/labour organizations to assess the average required education for a particular job (e.g., Rumberger 1987 andGreen et al 2007). We adopt the last approach in this paper.…”

“…Australia has a selective immigration policy, favouring immigrants who are young, highly educated and with prior work experience that is likely to be immediately transferable to the Australian labour market. Still, several studies have shown that immigrants are often employed below their education level and argued that immigrants' skills are not fully utilised in the Australian labour market (see for example Green et al 2007). Our paper complements these studies in a specific way.…”

Over-Education Amongst the Children of Immigrants in Sweden

“…Kiker et al 1997;Rubb 2003;Sicherman 1991), very few studies of mismatch are related to immigrants in the labour market, as stated in the introduction. Notable exceptions include Berggren & Omarsson (2001), Oscarsson & Grannas (2001, Bevelander & Lundh (2007), Green et al (2007), Chiswick & Miller (2009), Dahlstedt (2011, Kalfa & Piracha (2013), Nielsen (2007) and Nordin et al (2008). To my knowledge, no research has been conducted on the descendant generation in Sweden or elsewhere.…”