Kahn SEWP October 191

DiscussionBender/HeywoodEducational Mismatch among Ph.D.s

Shulamit Kahn

SEWP conference

October 18, 2005

Kahn SEWP October 192

Questions I address

Why might people have education/job mismatches?

Is each theory of mismatches consistent with these findings?

What are the efficiency implications? What are the policy implications?

Kahn SEWP October 193

1. Technological change means that the education is no longer useful

Consistent with: Mismatched lower wages Mismatched lower satisfaction Mismatched later job change

What are efficiency implications? Policy implications? We lose the value of SET human capital, but that is

probably inevitable and desirable. Does not mean we should educate less. Would argue against academic tenure in science.

Kahn SEWP October 194

2. SET education is subsidized or over-encouraged. There aren’t enough jobs.

Probably, the people who leave SET are those least productive in SET or most productive elsewhere.

Consistent with: Mismatched lower wages Mismatched lower satisfaction Mismatched later job change

What are efficiency implications? Policy implications? We lose the cost of the education. We should stop

subsidizing SET education (as much).

Kahn SEWP October 195

3. Education increases avg productivity (in SET jobs). Post-education, there are random realizations of job offers from both in and outside of education field.

Consistent with: Mismatched lower wages

e.g. Wf = X + K + ei Wm = X + ej Go to highest W K = 1 distribution: ed 0,1,2,3 avg: in field: 3 mismatched: 2.67

Mismatched lower satisfaction Mismatched later job change

What are efficiency implications? Policy implications? We lose the cost of the education. Great if it were possible to know

e’s beforehand (e.g. require job experience before Ph.D.) If not, no policy change will help. (People wouldn’t get educated if it wasn’t a better choice.)

Kahn SEWP October 196

4. For some, education is a step to other jobs not in the field.

Consistent with: Mismatched lower wages Mismatched lower satisfaction Mismatched later job change

What are efficiency implications? Policy implications? There is no suggestion that society is educating too

much.

opposite?

Kahn SEWP October 197

5. Any group has some losers who aren’t good at anything. They will be more likely not to get good jobs, including SET jobs.

Consistent with: Mismatched lower wages Mismatched lower satisfaction Mismatched later job change

What are efficiency implications? Policy implications? We lose the cost of the education. Ideally, the

educational system would be better at identifying losers. Have potential employers involved in Ph.D. application process? Require job experience before Ph.D.?

Kahn SEWP October 198

6. Employers mistakenly do not believe that the person can really do the SET job.

Consistent with: Mismatched lower wages Mismatched lower satisfaction Mismatched later job change (for the better)

What are efficiency implications? Policy implications? We lose the cost of the education. Requires employers

to change attitudes.

Kahn SEWP October 199

With age, men (women) in mismatched job see wages slow/fall more (less). i.e. Size of wage mismatch penalty is larger (smaller) for older men (women).

1. Technological change education useless.

2. SET education is subsidized or over-encouraged.

3. Random post-ed job offers within/outside field (Mick Jagger).

4. Education a stepping stone (Rush Holt)

5. Losers can’t get an SET (or any good) job.

6. Employers misjudge person’s capabilities.

Men Women

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More probably, wage profile is less concave in SET, especially academic, jobs. Could test by interacting age & academic?

Kahn SEWP October 1910

Women who leave for pay/promotion have more $ (but not happier). Men: a bit (less sig) more $

1. Technological change education useless.

2. SET education is subsidized or over-encouraged.

3. Random post-ed job offers within/outside field (Mick Jagger) .

4. Education a stepping stone (Rush Holt)

5. Losers can’t get an SET (or any good) job.

6. Employers misjudge person’s capabilities.

Men Women

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Kahn SEWP October 1911

Mismatches due to “job not available in field” have less $ and happiness.

1. Technological change education useless.

2. SET education is subsidized or over-encouraged.

3. Random post-ed job offers within/outside field (Mick Jagger) .

4. Education a stepping stone (Rush Holt)

5. Losers can’t get an SET (or any good) job.

6. Employers misjudge person’s capabilities.

Kahn SEWP October 1912

Mismatches due to changed interests, career: a bit worse off in wage, not happier.

1. Technological change education useless.

2. SET education is subsidized or over-encouraged.

3. Random post-ed job offers within/outside field (Mick Jagger) .

4. Education a stepping stone (Rush Holt)

5. Losers can’t get an SET (or any good) job.

6. Employers misjudge person’s capabilities.

?

?

?

Kahn SEWP October 1913

Leaving field for family reasons, job location, working conditions: worse off in wage, less job satisfaction

1. Technological change education useless.

2. SET education is subsidized or over-encouraged.

3. Random post-ed job offers within/outside field (Mick Jagger) .

4. Education a stepping stone (Rush Holt)

5. Losers can’t get an SET (or any good) job.

6. Employers misjudge person’s capabilities.

7. Unexpected developments unrelated to field.