Individual and institutional influences on EU labour market returns to education: a comparison of the effect of the 2008 economic crisis on eight EU countries

ABSTRACT

This paper explores cross-national variations in the impact of education on labour market outcomes using the risk of unemployment and occupational status as the key dependent variables. The study applies a comparative perspective on eight EU countries (three from CEE), representing different relationships between the education system and the labour market with various degrees of inequality, welfare provisions and labour market flexibility. A temporal comparison investigates the influence of the 2008 economic crisis. The study employs data from the European Union Labour Force Survey 2007, 2009 and 2014. Binary and ordinary least squares regressions are the main analytical methods. Models are fitted to the pooled data and interactions are applied to elaborate on country and temporal variations. The analysis reveals the persistence of returns to school investments; the crisis exerts bigger risk and loss for the less educated. However, this impact is markedly shadowed by the institutional variation at the country level. High flexibility and low inequality could provide some defence, while corporatist features and employment protection decreased the crisis effects. Post-communist countries were hit harder but with a characteristic variance: Slovenia was less affected, Estonia recovered the crisis faster and Hungary was affected at most.

KEYWORDS:

• Returns to education
• occupational status
• unemployment
• labour market
• the 2008 economic crisis
• comparative analysis

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes on contributors

Péter Róbert, Prof. has graduated in sociology at Eötvös Lóránd University (ELTE), received his PhD from the Hungarian Academy of Sciences (HAS) and has made his habilitation at ELTE University. He is fulltime Professor of Sociology at Széchenyi University, Győr, at the Department of Social Work and Sociology. He has been working for TÁRKI Social Research Institute as senior researcher since 1986. His current project titled Children in school: Well-being and beyond - The International Survey of Children’s Well-Being (ISCWeB). His research interests involve social stratification, educational inequalities, school-to-work transition, the perception of social inequalities and the subjective well-being. He has published in edited volumes by Oxford University Press, Princeton University Press, Edward Elgar Publishing Ltd., Routledge, Springer or Stanford University Press as well as in journals like RSSM, ESR, European Societies, ERE.

Ellu Saar, Dr, is a Professor of sociology at the Institute of International and Social Studies and School of Governance, Law and Society, Tallinn University, Estonia. She coordinated the EU Sixth Framework Project ‘Towards a Lifelong Learning Society in Europe: The Contribution of the Education System’ (LLL2010). She is now leading the project ‘Cumulative processes in the interplay of educational path and work career: explaining inequalities in the context of neoliberalization’ and participates in the EU Horizon 2020 projects ‘Encouraging Lifelong Learning for an Inclusive and Vibrant Europe’ (ENLIVEN) and 'Technological inequality - understanding the relations between recent technological innovations and social inequalities'. Her research areas are social stratification and mobility, educational inequalities and life course studies in comparative perspective.

Margarita Kazjulja (PhD), is a researcher at the Institute of International and Social Studies, School of Governance, Law and Society at Tallinn University. Her research interests include education, different aspects of social stratification in labour market, and individual strategies in coping with changes in a transition society.

Notes

1 The original welfare regime typology has clear limitations. It assumes that the Southern European follow a similar institutional logic with respect to employment regulation to the Continental countries. It was argued that the Southern countries have a sub-protective welfare system where the coverage of benefits is very incomplete and active employment policy virtually non-existent (Gallie and Paugam 2000). The Continental countries have the universalistic, employment-centred system Previous analysis indicated sharp differences between these two types of countries in the pattern of change over the crisis (Gallie 2013c).

2 Unfortunately it is not possible to distinguish programme orientations in the EU LFS 2007 and 2009 data sets. It is an important restriction. Implementation of ISCED 2011 and the new section on orientation of study in the EU LFS 2014 offers possibilities to distinguish programme orientations at upper-secondary level.

3 Selection into employment has been taken into account in the models of occupational status. These models apparently do not consider unemployed; no of observations are lower in the models in Table A2 than in Table A1.

4 These analyses are available from the authors upon request.