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Entry into the working life: spatial mobility and job-match quality of higher educated graduates

Entry into the working life: spatial mobility and job-match quality of higher educated graduates. NARSC Conference, Nov. 11 th – 13 th 2010 Denver, Colorado, U.S.A. Viktor Venhorst Faculty of Spatial Sciences, University of Groningen Frank Cörvers

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Entry into the working life: spatial mobility and job-match quality of higher educated graduates

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  1. Entry into the working life: spatial mobility and job-match quality of higher educated graduates NARSC Conference, Nov. 11th – 13th 2010 Denver, Colorado, U.S.A. Viktor Venhorst Faculty of Spatial Sciences, University of Groningen Frank Cörvers Research Centre for Education and the Labour Market, Maastricht University

  2. This presentation • Recent work on the pay-off to migration • Selectivity and heterogeneity • Our main contributions • Homogeneous sample, entering the labour market • Various measures of job match quality • Method and data: • Controls for observed and unobserved ability • Dutch graduate survey • Stylized facts, multivariate analysis

  3. Recent work on migration and payoff (1) • Migration as spatial job search • The composition of migration flows • Sjaastad (’62) • Selectivity and the return to skills • Borjas et al. (’92): premium on skills • Yi = α + β(Si – S) • Measuring the return to migration • Wage rate, unemployment (Herzog jr. et al ’93, Pissarides & Wadsworth ’89) • Measuring skill, effort • Selectivity and search effort • (Repeated) migration as a source of information, DaVanzo et al. (’81), Herzog jr. et al. (’85)

  4. Recent work on migration and payoff (2) • Dealing with unobservables • Panel data, retrospective information • Gabriel & Schmitz (’95, young males): selection • Axelsson & Westerlund (’98, Swedish HH): no selection, no payoff • Nakosteen et al (’08): • Obervables: females • Unobservables: males, females • Treatment – effect frameworks • Nakosteen et al. (’04, Swedish (un-) employed): selection, payoff • Smits (’01, Dutch couples): selection, payoff • Dostie &Léger (’09, Canadian physicians): selection

  5. Recent work on migration and payoff (3) • Accumulation of the skilled in certain regions • Berry and Gleaser, ’05, Faggian and McCann, ’06, Détang-Dessendre et al., ’04 • Variety in results: heterogeneity • Krieg, ’97, Yankow, ’93, Lehmer & Ludsteck, ’10 • Pay-off over time, for different groups • Delayed returns for the skilled, higher (discounted) returns for the young • Selection of reference groups • Job-changing migrants versus non-job-changing migrants

  6. This study • Homogeneity? • College and university graduates • Young, recently graduated • Making entry into the labour market • But: within group variety in mobility (degree of mobility & direction), separate analysis: • College and university • Economics and healthcare graduates • Variety of job-match measures • How discerning is the wage rate relative to other job-characteristics, for this particular group?

  7. Data: college and university graduates • Sample: ROA Schoolleaver survey • Graduation years ’04-’05 through ’06–’07 • Observed 18 months after graduation (’06-’08) • Job, study and demographic characteristics • Location information (municipalities): • Housing area at age 16 (home region) • Study region • Work region • N ~ 16100 (college) and 8500 (university)

  8. Method • Treatment effects regression • Outcome equation Yi = Xiß + δMi + εi • Selection equation mi = Ziγ + ui with Mi = 1 if mi > 0, and Mi = 0 for mi ≤ 0 • Selection: correlation between εi and ui: Parameter λ • Outcome equation: linear, ln(hourly wage rate) • Selection equation: probit, pr(relatively mobile post graduation) • Proxy for unobserved ability / effort: • Relative mobility pre-study, foreign parent, study duration • Bivariate outcome equations for alternative measures • Seemingly unrelated bivariate probit

  9. Relative mobility • Negative and positive selectivity • Graduates who hail from opportunity rich regions to begin with, do not have to be mobile • Mobility therefore measured in relative terms: • Mi = Distancei / Distancepeers • Peer group = f(field of study, year, region of origin, college or university) • Mobility post graduation: dummy • Mi =1 if Distancei / Distancepeers > 1 • Mobility pre studies: continuous

  10. Migration and the hourly wage rate

  11. Conclusions: hourly wage rate & mobility • Spatially mobile graduates earn more than graduates staying behind in the study region, as well as the stayers in the destination (work) region • Exception: west • Selection on observables • Positive effects on mobility and wage rate from varying HC indicators • Selection on unobservables • Positive self selection (college grads) • After control, no remaining effect of mobility on wage rate

  12. Conclusions: introducing variety • Homo- or heterogeneity? • Results differ strongly between disciplines • Relation with underlying labour market processes • Labour queue effects and forced migration • Alternative measures • College: some evidence for positive self-selection, no or negative returns after correction • University: limited evidence of selectivity, no or positive returns after correction • Roughly in line with wages, but forced migrants look to suffer more in terms of these alternative job match measures

  13. Thank you for your attention v.a.venhorst@rug.nl

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