The scarring effects of unemployment, low pay and skills under-utilization in Australia compared

Konstantinos Mavromaras, Peter Sloane, Zhang Wei

Research output: Contribution to journalArticlepeer-review

14 Citations (Scopus)

Abstract

There is a substantial literature on the scarring effects of unemployment on future employment prospects and a smaller one on the scarring effects of low pay, but the possibility that skills mismatch, in the form of skills under-utilization, may have similar detrimental effects has not been considered before. We use the Household, Income and Labour Dynamics in Australia panel to investigate the dynamics of unemployment, low pay and skills under-utilization, including differences by gender and education. We show that, in addition to earlier evidence on wage penalties and reduced job satisfaction, skills under-utilization scars future employment prospects in a way similar to that of low pay.

Original languageEnglish
Pages (from-to)2413-2429
Number of pages17
JournalApplied Economics
Volume47
Issue number23
DOIs
Publication statusPublished - 15 May 2015

Keywords

  • dynamic estimation
  • education pathways
  • job quality
  • low pay
  • skills mismatch
  • state dependence
  • unemployment

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