Assessing the incidence and wage effects of over-skilling in the Australian labour market

Mavromaras, Kostas G.

Assessing the incidence and wage effects of over-skilling in the Australian labour market

This paper examines the incidence and wage effects of over-skilling within the Australian labour market. It finds that approximately 30 per cent of employees believed themselves to be moderately over-skilled and 11 per cent believed themselves to be severely over-skilled. The incidence of skills mismatch varied little when the sample was split by education. After controlling for individual and job characteristics as well as the potential bias arising from individual unobserved heterogeneity, severely over-skilled workers suffer an average wage penalty of 13.3 per cent with the penalty ranging ... Show more