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ABSTRACT
The aim of this paper is to present a descriptive overview of patterns and labour market outcomes characterising the labour market entry in Estonia compared to the EU countries. The assumption that labour market institutions and educational systems have an impact on the labour market entry process makes up the starting point for the formulation of the hypotheses. The hypotheses have been formulated on the basis of the comparison between the educational systems as well as labour market institutions in Estonia and in the EU countries. The paper draws upon data from the Estonian Labour Force Survey (ELFS) 2002 and from the 1997 ELFS’ macro level data about the EU countries. The paper will present evidence concerning differences in labour market outcomes between new entrants and experienced workers. Based on macro level data, the analysis will attempt to empirically identify distinct country clusters.
This study has been prepared as part of the research project funded by Estonian Science Foundation (grant no. 5110). Support by and discussion with my colleagues Jelena Helemäe, Rein Vöörmann, Marge Unt and Mari Toomse are gratefully acknowledged. Two anonymous reviewers provided additional invaluable comments. Data from the Estonian Labour Force Survey have been provided by Estonian Statistical Office.
Notes
1One can distinguish two kinds of surveys covering the school-to-work transition: age cohorts, which are based on the date of birth and event cohorts, grouping people who have experienced the labour market entry at the same time.
2First group includes Denmark, Germany and Austria; the second Greece and Italy, the third France, Sweden and Finland and the fourth Belgium, The Netherlands, Portugal, Spain, the UK and Ireland.
3Couppié and Mansuy (2001a) have used a different method. The European Labour Force Survey did not include information on the dates of entry into the first permanent job. They used information on the highest level of general education and post-school training attained by individuals. By drawing on the national educational contexts they constructed the typical ages of leaving educational system. On the basis of this information and the age of respondents the theoretical period elapsing since the diploma was calculated.
4Estonian set of indicators is calculated by author. For other countries we use data from report published by Cedefop (2001) and the working paper of Couppié and Mansuy (2001a).
5The Ward algorithm achieves a sequential fusion of least deviant case.
6There is the issue of the extent to which the chosen cluster solution might depend on particular indicators. The results from a sensitivity analysis based on the deletion of single indicators from the cluster analysis are quite supportive of the solution (see Appendix 3). According to our results no single aspect of early work career is of decisive importance for arriving at the cluster solution. Effect of education on unemployment rate of new entrants, as well vulnerability to unemployment deserves special attention as probably the most influential indicators in the analysis. Removing effect of education on unemployment rate from the set of indicators leads to an important reallocation of the countries, the UK and Ireland clustering together with France, Finland and Spain, Estonia and Portugal belongs with Sweden to another cluster. Deletion of vulnerability to unemployment from the cluster analysis has changed the allocation of two countries; Belgium belongs to one cluster with France, Finland and Spain, Sweden to another cluster with the UK, Ireland, Portugal and Estonia.
7Their second cluster is analogous with our first cluster which include Italy and Greece. The cluster closest to the regulated inclusion type includes in Couppié's and Mansuy's clustering Austria, Germany, Denmark and The Netherlands. In our clustering The Netherlands belongs with Belgium to the separate cluster. Their most heterogeneous cluster (Belgium, Ireland, France, Finland, Luxembourg, Portugal, Sweden and the United Kingdom) splits in our clustering into two clusters. Spain forms a separate cluster.