Journal of Youth Studies

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Educational mismatch in recent university

graduates. The role of labour mobility

Cecilia Albert, Maria A. Davia & Nuria Legazpe

To cite this article: Cecilia Albert, Maria A. Davia & Nuria Legazpe (2023) Educational mismatch
in recent university graduates. The role of labour mobility, Journal of Youth Studies, 26:1,
113-135, DOI: 10.1080/13676261.2021.1981840

To link to this article: https://doi.org/10.1080/13676261.2021.1981840

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JOURNAL OF YOUTH STUDIES
2023, VOL. 26, NO. 1, 113–135
https://doi.org/10.1080/13676261.2021.1981840

Educational mismatch in recent university graduates. The role

of labour mobility
a b c
Cecilia Albert , Maria A. Davia and Nuria Legazpe
a
Departamento de Economía, Universidad de Alcalá, Madrid, Spain; bDepartamento de Economía Española e
Internacional, Econometría, Historia e Instituciones Económicas, Universidad de Castilla-La Mancha,
Albacete, Spain; cDepartamento de Economía Española e Internacional, Econometría, Historia e Instituciones
Económicas, Universidad de Castilla-La Mancha, Cuenca, Spain

ABSTRACT ARTICLE HISTORY

This article analyses patterns of persistence in both vertical and Received 7 September 2020
horizontal educational mismatch in the early career of university Accepted 13 September
graduates in Spain, with particular emphasis on the mediating 2021
role of job mobility. We explore whether educational mismatch is
KEYWORDS
a stepping stone towards better-matched positions or whether University graduates;
graduates get trapped in mismatched jobs. Our results show that overeducation; horizontal
job mobility partially corrects educational mismatch (supporting education mismatch; job
the stepping stone hypothesis), but there is still a strong mobility; stepping stone;
persistence in educational mismatches four years after graduation entrapment
(the trap hypothesis). Vertical mismatch is, overall, less persistent
than horizontal mismatch, in part because some horizontally
mismatched graduates lack incentives to make corrective
movements across employers because of compensating job
features that keep them in their first jobs. Job rotation and poor
accumulation of employment experience challenge the correcting
role of job mobility in educational mismatch risk. These results
reflect relevant features of the Spanish labour market: segmentation,
intensive job turnover and high youth unemployment.

1. Introduction
This work aims to analyse persistence in vertical (overeducation) and horizontal edu-
cational mismatch (linked to the field of education) in recent university graduates in
Spain. It intends to contrast the stepping stone and trap hypotheses regarding mismatch
between graduates’ education and their job by disentangling the role of endogenous
mobility across jobs in correcting – or aggravating – educational mismatch.
In recent years, the Spanish labour force has absorbed a dramatic increase in the
number of university graduates1, but the number of vacancies in high-skilled occupations
has not increased at the same pace (Ramos 2017). Moreover, the high youth unemploy-
ment rates push many young university graduates to accept jobs that are poorly related

CONTACT Nuria Legazpe nuria.legazpe@uclm.es Departamento de Economía Española e Internacional, Econome-

tría, Historia e Instituciones Económicas, Universidad de Castilla-La Mancha, Avenida de los Alfares, n° 44, 16071, Cuenca, Spain
This article has been republished with minor changes. These changes do not impact the academic content of the article.
© 2021 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group
This is an Open Access article distributed under the terms of the Creative Commons Attribution-NonCommercial-NoDerivatives License
(http://creativecommons.org/licenses/by-nc-nd/4.0/), which permits non-commercial re-use, distribution, and reproduction in any
medium, provided the original work is properly cited, and is not altered, transformed, or built upon in any way.
114 C. ALBERT ET AL.

to their qualifications or skills. This results in persistently high levels of educational and
skill mismatch rates in the Spanish graduate labour market (Delaney et al. 2020).
Exploring persistence in educational mismatch is very relevant: graduates’ potential
entrapment in mismatched positions erodes their career prospects, reducing private
and public returns to education. Confirming and understanding such persistence would
have relevant implications for labour market and higher education policies. If graduates
were trapped in mismatched positions, employment policies should assist them to be
more efficient in their job search. In parallel, efforts to promote the demand for graduate
labour would be needed as well. If educational mismatch were a stepping stone towards
better-matched positions, graduates’ pace of entry into employment would be prioritised
over obtaining / accessing well-matched positions in the first instance.
This paper aims to contribute to the evidence on educational mismatch risk persist-
ence in three different ways. First, we analyse vertical and horizontal educational mis-
match at the same time. Both dimensions of mismatch are intertwined and, at the
same time, related to job mobility in different ways. Secondly, our empirical strategy
acknowledges the endogeneity of job mobility, which may be mismatch-driven.
Thirdly, we address differences across fields of education in both educational mismatch
and job mobility in the early stages in the graduate labour market.
Our results show that job mobility reduces educational mismatch risks (stepping stone
hypothesis). Still, there is significant persistence in educational mismatches four years
after graduation, which supports the trap hypothesis. Some horizontally mismatched
graduates are trapped in their first mismatched jobs in part because they lack incentives
for corrective job mobility because of compensating job features. Particularly, they lack
the incentive of permanent contracts, which are scarce in the deeply segmented
Spanish labour market. As a result, horizontal mismatch ends up being more persistent
than vertical mismatch. Moreover, intense mobility across employers (job rotation) and
scarce accumulated experience aggravate both vertical and horizontal mismatch risks
four years after graduation.
Our mixed evidence calls for better guidance in graduates’ initial steps in the labour
market and, given that job mobility only partially corrects educational mismatch risks, pol-
icies that foster the demand for graduate labour would also be crucial. Reducing segmen-
tation in the Spanish labour market is also necessary as some workers are trapped in
education mismatch either because they suffer intense job rotation and poor human
capital accumulation or because accepting better-matched jobs would entail risking
employment stability.

2. Background and hypotheses

2.1. Educational mismatch: stepping stone or trap?
The economic literature has formulated two hypotheses on the persistence in job mis-
match: the stepping stone hypothesis and the trap hypothesis.
The stepping stone hypothesis predicts the transitory nature of educational mismatch
in the first job upon graduation on the premise that that early mismatch is driven by lack
of labour market experience (Becker 1964) and imperfect information in the labour market
(Spence 1973; Stiglitz 1975). Mobility across employers contributes to workers’ acquisition
 JOURNAL OF YOUTH STUDIES 115

of experience and marketable skills, better self-assessment of their own skills and abilities
and higher awareness of those required by prospective employers. Job search models
predict young graduates’ preference for mismatch over unemployment (Baert, Cockx,
and Verhaest (2013). They would accept mismatched positions to avoid it (Voßemer
and Schuck 2015), as prospective employers may perceive it as a stronger sign of poor
productivity than educational mismatch (Baert and Verhaest (2019); Cockx and Picchio
(2013)). This (voluntary and worker-driven) job mobility will result in better matches, in
line with the Job Mobility Theory (Jovanovic 1979). A later refinement of this approach,
the Theory of Occupational Mobility (Sicherman and Galor 1990), reaches a similar predic-
tion by arguing that graduates may accept mismatched positions as a price for entering
their preferred occupations via internal promotions or upward occupational mobility
across employers. Educational mismatch would be transitory and even strategic.
Our empirical analysis would test this occupational mobility theory rather than job
search models, since we do not explicitly compare those who accepted mismatched pos-
itions after graduation to avoid the scar of unemployment with those who remained
unemployed some time while searching for a properly matched job. Instead, we
compare mismatch risks four years after graduation between graduates who started in
a well-matched position and those whose first job was ill-matched. And we take into
account the length of the first job search spell in the prediction of educational mismatch
in the first job.
The trap hypothesis sees educational mismatch as a permanent, trapping phenom-
enon which scars graduates’ careers. Prospective employers interpret candidates’ prior
mismatches as a sign of low abilities/skills for different reasons. First, if mobility across
jobs driven by early mismatch is very intensive, initially mismatched workers will accumu-
late low levels of specific human capital and can even suffer cognitive decline (de Grip
et al. 2007). Moreover, educational mismatch could create certain habituation as it is
financially and psychologically less costly than unemployment (Verhaest and Omey
2009). Finally, since on-the-job search intensity in mismatched workers is lower than in
non-employed individuals (Holzer 1987), employers will have fewer incentives to create
high-quality positions for graduates (Dolado, Jansen, and Jimeno 2009).
A different strand of literature explains early occupational mismatch beyond frictions
that stem from the job search process: job competition theory (Thurow 1975) and assign-
ment theory (Sattinger 1993) stress the relevance of structural mismatches between
labour supply and demand.2 Insufficient provision of vacancies in graduate labour
markets and field saturation will result in higher levels of vertical and horizontal mismatch
regardless of graduates’ characteristics and will lock them in mismatched positions no
matter how intensively they look for well-matched ones (Baert, Cockx, and Verhaest 2013).
This problem is exacerbated in recessions: unemployment rates and competition for
jobs reach peak levels, making graduates adjust their goals and accept mismatched pos-
itions (Wolbers 2003). Our working sample is representative of the graduating cohort in
academic year 2009/2010, which was severely hit by the Great Recession (see Cabasés,
Pardell, and Strecker (2016) for a description of the crisis in Spain). We would expect
those graduates to be particularly prone to accept ill-matched positions and to
become trapped in ill-matched jobs, in accordance with the evolution of mismatch
risks in the Spanish labour market during the Great Recession described in Pascual, Gon-
zalez-Prieto, and Cantarero-Prieto (2016).
116 C. ALBERT ET AL.

This paper discusses persistence in vertical and horizontal mismatch. We think that the
relevant hypotheses would equally apply to both types of mismatch since prospective
employers may perceive them both as a signals for low abilities or skills and inadequate
acquisition of specific human capital amongst candidates to their vacancies. They may be
summarised as follows. Hypothesis 1 (stepping stone): at the moment of the interview,
initially mismatched graduates transitioning to a new job will experience significantly
lower mismatch risks in their new positions while those initially matched will be rather
unlikely to fall into mismatched ones, which will result in lower average mismatch rates
in new jobs four years after graduation than in the first jobs right upon graduation.
Hypothesis 2 (trap hypothesis): at the moment of the interview, initially mismatched
graduates will be much more likely to be mismatched in their new position than their
initially well-matched counterparts (i.e. persistence in mismatch risks despite job mobi-
lity). Job mobility notably reduces mismatch risks inasmuch as graduates who feel mis-
matched in their first jobs will have incentives to move across employers in the search
for better-matched positions (contributing to the stepping stone hypothesis). Otherwise,
if mismatched workers were less mobile than those in well-matched jobs, the trap effect
would be reinforced. Similarly, job mobility impact on ulterior mismatch risks will be chal-
lenged if it is very intense. It may reflect that mismatched graduates become trapped in
low-quality jobs in the secondary labour market (contributing to the trap hypothesis).

2.2. Recent findings that contrast the stepping stone and trap hypotheses
Most of the international evidence on educational mismatch is in line with the trap
hypothesis. In Spain, Acosta-Ballesteros, Rosal, and Rodríguez-Rodríguez (2018) and
Sánchez-Sánchez and Fernández (2020) confirm persistence in vertical mismatch, while
Rodríguez-Esteban, Vidal, and Vieira (2019) find it in horizontal mismatch. Acosta-Balles-
teros, Rosal, and Rodríguez-Rodríguez (2018) study persistence in overeducation in
young adults (not only university graduates), while Sánchez-Sánchez and Fernández
(2020) study adult workers and show how the difficulties of finding any job – defined
by regional unemployment rates – push them towards jobs where they are overeducated
and keep them in those kinds of positions for a long time. Both studies control for poten-
tial endogeneity in initial conditions, the former in a multi-equation multivariate strategy
and the latter taking advantage of the panel structure of their data and employing Wool-
dridge’s (2005) approach.
Rodríguez-Esteban, Vidal, and Vieira (2019) find very interesting nuances when explor-
ing the 2014 Survey on the Labour Insertion of University Graduates (EILU-2014, following
its Spanish nomenclature, Encuesta de Inserción Laboral de los Titulados Universitarios) to
analyse persistence in horizontal mismatch. They find that the proneness to horizontal
match in the first job is typically defined by variables related to educational background,
while mismatch in the current job is more determined by job features.
The degree of persistence in educational mismatch varies across countries (see
Sánchez-Sánchez and Fernández (2020) and Congregado et al. (2016) for very good
surveys of international evidence). However, most of the international evidence3 finds
state dependency and persistence in overeducation in liberal labour markets, continental
European, transition economies and Southern Europe. Examples in liberal markets include
the US (Rubb 2003), the UK (Dolton and Vignoles 2000) and Australia (Mavromaras and
 JOURNAL OF YOUTH STUDIES 117

McGuinness 2012), and those in continental European refer to Germany (Blázquez and
Budría 2012; Boll, Leppin, and Schömann (2014)) and Flanders (Baert, Cockx, and Verhaest
2013). The same holds in transition economies such as in Poland (Kiersztyn 2013) and
Southern Europe / the Mediterranean (the abovementioned works that analyse Spain).
Comparative studies illustrate differences in educational mismatch persistence across
countries. Evidence from the REFLEX study (Research into employment and professional
FLEXibility) (Verhaest and Van der Velden (2013) and Meroni and Vera-Toscano (2017))
confirms this diversity. In Verhaest and Van der Velden (2013), cross-country differences
in mismatch persistence are explained by the quality and the orientation – specific
versus general – of the educational system/programme and the relative oversupply of
highly skilled labour and output gaps, measured through unemployment rates. Meroni
and Vera-Toscano (2017) find higher levels of persistence in Continental, Southern and
Eastern countries than in the UK and Scandinavian countries, in line with Verhaest and
Van der Velden (2013). The authors also explain cross-national differences from the strict-
ness of employment protection legislation. Graduates will remain in ill-matched positions
not only if unemployment rates are very high but also if employment protection stan-
dards discourage them from moving across jobs. That would be the case, they reckon,
in Southern European countries.
The inconclusive evidence on persistence in mismatch may be due to measurement
problems in the definition of the dependent variables. Graduates who perceive them-
selves – or are perceived by researchers – as formally overeducated but underperform
in relevant skills will be less likely to experience upward occupational mobility and, there-
fore, to overcome educational mismatch via job mobility.
Moreover, trap and stepping stone effects are not necessarily mutually exclusive: edu-
cational mismatch may tend to be persistent and difficult to overcome, but it may push
some workers towards new jobs, well-matched positions (in the US, Rubb (2006) finds
higher levels of upward occupational mobility amongst overeducated workers, but that
does not mean that all of them get a well-matched position).

3. Materials and methods

3.1. Data set and samples
The 2014 Survey on the Labour Insertion of University Graduates (EILU-2014) is pro-
vided by the National Statistical Office (Instituto Nacional de Estadística, INE). As
explained in the INE methodological guidelines (INE 2016), the data set consists of a
sub-set of graduates that represent – under random single-stage sampling – all
those who graduated in academic year 2009/2010 in all Spanish private and public uni-
versities but one: Pablo de Olavide, in Seville. The information is sourced from the Inte-
grated University Information System4, which provides personal academic information
stemming from university records5, the census, Social Security records, the National
Public Employment Service and an ad-hoc questionnaire. The latter captures infor-
mation about the characteristics of the first job and the job at the time of the interview,
four years after graduation (in 2014). In this way, the structure of the data set resembles
the international REFLEX study, which allowed for a five-year span between graduation
and the interview.
118 C. ALBERT ET AL.

The selection of the sample is as follows: the initial sample has 30,379 observations.
Because of the particularities in their academic curricula6, we drop the observations of
those who graduated in 2009/2010 under the Bologna system (880 observations, 2.9%
of the sample), as it was not fully implemented yet and they may have just graduated
from pilot or bridge programmes. We also drop 1,764 observations of those who had
never worked since graduation (5.99% of the sample). The remaining sub-sample
(27,680 individuals) represents 91.11% of the initial one. Once missing values in the vari-
ables that identify mismatches in the first job and the job at the time of the interview are
dropped, the final sample consists of 24,170 observations. These all correspond to gradu-
ates in both ISCED 5A and 5B degrees, for whom an initial mismatch might be predicted.
For most of them (23,976), it is possible to predict job mobility, and mismatch at the
moment of the interview is estimated only for job movers – i.e. those whose job differs
from the first one–who account for 12,537 observations.

3.2. Measuring education mismatch and mobility across jobs

3.2.1. Educational mismatch
In this section, we describe how educational mismatch is measured in this particular work
and discuss some measurement issues in the study of educational mismatch. Vertical edu-
cational mismatch happens when graduates’ level of education exceeds the requirement
for their jobs (overeducation). Horizontal mismatch refers to a poor match between the
content of the graduates’ job and their field of education (Robst 2007).
There are three main approaches to the measurement of educational mismatch: sub-
jective, objective and empirical (see a discussion in Leuven and Oosterbeek (2011) for ver-
tical mismatch and Somers et al. (2019) for horizontal mismatch). The first one is based on
workers’ self-assessment of the level and/or field of education required/most appropriate
for their job. In the second one, experts assign job requirements to particular occupational
codes in occupational classifications. In the third one, the degree of appropriateness of
the education is established from realised matches in the understanding that the most
common match – correspondence between each occupation and a certain level/field
of education – is the right one.
Objective job analysis is preferred over realised matches, as the latter can be biased by
gaps between supply and demand in the labour market. Still, its validity has been called
into question (Hartog 2000); it is expensive and not always easy to implement in comparative
international analyses or adjust to the evolution of educational systems. Subjective measures
are vulnerable to measurement errors (Meroni and Vera-Toscano 2017): workers may be ill-
informed about the skills needed in other jobs or they may wrongly perceive themselves as
well matched just because of employers’ increasing hiring standards resulting from the rela-
tive oversupply of university graduates. Regardless of each method’s strengths and weak-
nesses, researchers hardly ever choose between the aforementioned strategies, as they
are constrained by the data set they are handling. They can only accept the shortcomings
of the strategy they employ and interpret their results with the necessary caution.
In this paper, we employ the subjective method for measuring vertical and horizontal
educational mismatch since the EILU-2014 questionnaire asks interviewees to assess the
required level and field of education at their first and current job (when different from the
first one).
 JOURNAL OF YOUTH STUDIES 119

We identify vertical mismatch when graduates report that the most appropriate level
of education for their (first or current) job was below a university degree.7 This would be
the case, for example, of a nurse working as a nursing assistant. We identify horizontal
match when graduates report that the most appropriate field of education for their
(first or current) job was ‘solely their own field of study’ or ‘either their own field of
study or some related one’. As in Kucel and Vilalta-Bufí (2013), those who reported that
‘a completely different field of study’ or ‘no particular field’ would be appropriate for
their job(s) were classified as horizontally mismatched. Following our previous example,
a nurse working as a marketing manager would be horizontally mismatched.

3.2.2. Measuring mobility across jobs and job rotation

We identify mobility across jobs when, at the moment of the interview, the interviewee
reports her job differs from her first one as a graduate. Table 1 describes labour mobility
according to mismatch in the first job: about four years after graduation, 27% of graduates
who reported at least one job upon graduation remained in their first jobs, 54.3% held a
different one and 18.7% were non-employed. Those who experienced initial vertical or
horizontal mismatch in their first job were less likely to continue there and more likely
to be non-employed at the time of the interview than their initially well-matched counter-
parts. The share of those in new jobs – job movers – is higher amongst youth who were
vertically mismatched in their first job than those initially well matched (56.5 versus
52.9%), while it is slightly lower for those in initial horizontal mismatch (53.2 versus 54.7%).
Job mobility may be intensive and graduates affected by job rotation (here measured
by the self-reported number of employers) or long spells of non-employment upon
graduation may be more exposed to educational mismatch. In EILU-2014, the number
of employers takes values from 1 to 8 (8 includes 8 or more employers). For the descriptive
analysis we group the distribution in three categories: fewer than three, three to four and
five or more, while we will take the original variable as continuous in the multivariate
analysis to ease results interpretation. The questionnaire also has information on the
overall number of months graduates have been employed since graduation. For the
sake of simplicity, we categorise it in just two groups: less than two years and two or
more years. Table 1 shows that 13.6% of graduates had worked for five or more employers
after graduation and 29.4% had accumulated less than two years of employment experi-
ence. Both shares were larger amongst graduates who were ill-matched in their first jobs.
Therefore, intensive job rotation and potential lack of specific human capital are corre-
lated with initial mismatch. Both of them may challenge the effectiveness of job mobility
from the first job in reducing ulterior mismatch risks.

3.2.3. Transitions from a first job and persistence in educational mismatch

Table 2 displays horizontal and vertical mismatch risks in the first and current (if different)
job, distinguishing between initially well-matched and mismatched graduates. Vertical
and horizontal mismatch are higher in first jobs (37.6 and 27.1, respectively) than in
new ones (25.5 and 28.8, respectively). This may be because of a relevant transition
rate out of educational mismatch due to mobility across jobs (while initially well-
matched workers hardly fall into mismatched positions), which would support the step-
ping stone hypothesis.
 120
C. ALBERT ET AL.
Table 1. Labour market status at the time of the interview, number of employers and accumulated experience since graduation according to initial mismatch+.
No longer in first job
Still in the first job Different job Non-employed Total Moved to a new job (If no longer in first job)
All reporting one first job 27.0 54.3 18.7 100 74.3
Vertical educational mismatch in the first job
Matched 31.2 52.9 15.8 100 77.0
Mismatched 19.9 56.5 23.6 100 70.6
Horizontal educational mismatch in the first job
Matched 28.6 54.7 16.7 100 76.6
Mismatched 23.0 53.2 23.7 100 69.2

Number of employers since graduation

Fewer than three employers Three or four employers Five or more employers Total Little experience: accumulated less than two years since graduation
All reporting one first job 57.4 29.0 13.6 100 29.4
Vertical educational mismatch in the first job
Matched 61.8 26.8 11.4 100 25.0
Mismatched 50.1 32.6 17.3 100 35.2
Horizontal educational mismatch in the first job
Matched 59.7 28.1 12.3 100 25.8
Mismatched 52.1 31.2 16.8 100 36.1
Source: EILU-2014 (INE).
 JOURNAL OF YOUTH STUDIES 121

Table 2. Mismatch rates in first and current job (different from the first one) by mismatch in first job,
rotation and poor experience.
Mismatch rates in new, different job
Vertical Mismatch First job Average Matched in first job Mismatched in first job
Overall 37.6 25.5 9.2 50.9
Number of employers since graduation
Fewer than three 35.0 22.3 8.3 49.0
Three to four 39.9 25.8 9.6 50.4
Five or more 43.4 31.5 11.0 55.1
Little employment experience since graduation
Two or more years 35.4 23.5 8.5 49.4
Less than two years 43.0 32.3 12.4 55.3
Mismatch rates in new. different job
Horizontal Mismatch First job Average Matched in first job Mismatched in first job
Overall 29.1 22.8 10.8 53.0
Number of employers since graduation
Fewer than three 28.1 20.4 9.9 51.4
Three to four 29.7 23.1 10.9 52.6
Five or more 31.8 27.3 12.5 56.4
Little employment experience since graduation
Two or more years 27.3 20.8 10.0 51.2
Less than two years 33.4 29.8 13.9 57.6
Source: EILU-2014 (INE).

For initially mismatched movers, average vertical and horizontal mismatch rates are
around 50 percent, meaning that about half of them do indeed improve their mismatch
prospects through job mobility. Still, both vertical and horizontal current mismatch rates
are about five times higher than for those who held a first well-matched job8, and are well
above the average for job movers, confirming a relevant level of persistence in (mis-)
match in these early years in the graduate labour market. As for job rotation, educational
mismatch risks increase for both initially well-matched and mismatched graduates and
the absolute gap in educational mismatch between them slightly increases as they
move across additional employers. The same holds for those who accumulate little
working experience: they face higher mismatch risks and the gap between initially
matched and mismatched graduates is a bit more pronounced for them.

3.3. Modelling strategy

This section aims to present the multivariate econometric strategy employed to disentan-
gle the role of job mobility in educational mismatch persistence amongst early university
graduates. It starts from a simple model with exogenous job mobility and initial mismatch
and will end in a more nuanced and complex approach that entails endogenous selection
into both initial mismatch and mobility across employers. Our strategy has similarities
with previous ones like those in Mavromaras and McGuinness (2012) and, particularly,
in Acosta-Ballesteros, Rosal, and Rodríguez-Rodríguez (2018). The former correct for
initial conditions bias in a dynamic probit model; the latter apply an extension of the
recursive bivariate probit model, which entails control for endogenous selection into
initial mismatch.
The first stage to in addressing persistence in educational mismatch, using a cross-
section data set with retrospective information like EILU-2014, would consist of estimating
vertical and horizontal mismatch risks at the moment of the interview (y1v; y1h). These risks
122 C. ALBERT ET AL.

are estimated from the latent utility derived from working in a vertically or horizontally
mismatched job. The explanatory variables will be vertical and horizontal mismatch in
the first job (y0v and y0h) and other covariates related to job mobility: being in a new
job at the time of the interview (N1), job rotation (R1), the number of employers upon
graduation, and little accumulated experience since graduation (E1). The field of edu-
cation will be one of the most relevant variables in X1, one kx1 vector of observable expla-
natory variables designed to control for unobserved confounding factors and contribute
to properly identifying the relevant coefficients of the models.
The estimation would require a two-equation system, one for each type of mismatch:
∗
y1v = g′1v y0v + d′1v N1 + n′1v R1 + l′1v E1 + b′1v X1 + 11v; yv = 1
(1)
if yv∗ ≥ 0 and 0 otherwise

∗
y1h = g′1h y0h + d′1h N1 + n′1h R1 + l′1h E1 + b′1h X1 + 11m; yh = 1
(2)
if yh∗ ≥ 0 and 0 otherwise

where the coefficients for initial mismatch (γ1vv and γ1hh) would aim to measure persist-
ence in vertical and/or horizontal mismatch. The coefficients d′1v and d′1h capture the
impact of job mobility on graduates’ current educational mismatch, while vectors n′1v
and n′1h would identify the potentially scarring impact of job rotation and l′1v and l′1h
would indicate the additional mismatch risk related to lack of experience. Finally, b′1v
and b′1m are the relevant sets of parameters for the vector of explanatory variables, X1.
The error terms ε1v and ε1m represent the impact of unobserved variables on yv and yh
and are normally distributed with mean 0, with variances σv, σh and the covariance σvh.
Statistical significance of the off-diagonal element of the variance-covariance matrix (Σ),
ρvh, would recommend the joint estimation of this equation system by maximum likeli-
hood in a bivariate probit model.
The aforementioned strategy may suffer endogeneity. The coefficients that identify
persistence in mismatch (g′1v , g′1h ) would be biased downwards if the quality of graduates’
current job match and first job match were explained by common unobserved features
such as innate abilities and personality traits that influence the graduate’s employability
in the first case. If initial mismatch were not assigned randomly but were particularly
present in poorly skilled or low-productivity graduates, the coefficient would be biased
downwards as the probability of these graduates’ working in low-quality jobs would be
similarly high both at graduation and four years afterwards. Moreover, the main explana-
tory variable (job mobility) may be endogenous9 to initial educational mismatch: if mis-
matched graduates tend to move more (or less) across jobs than well-matched ones,
d′1v and d′1h would be biased as well. What is more, given that educational mismatch at
the time of the interview (y1v, y1h) will be the same as in the first job (y0v, y0h) for job
stayers, the interest in the size of γ1v, and γ1h lies in the sub-sample of job movers.
However, this group is not randomly selected, and we need to consider endogenous
sample selection in the determination of educational mismatch. If initially mismatched
workers were more mobile than those starting in a well-matched job, we would overes-
timate the impact of job mobility on mismatch reduction (d′1v and d′1h ). Similarly, if mis-
matched workers were less mobile than well-matched ones, the impact of job mobility
on mismatch reduction would be underestimated.
 JOURNAL OF YOUTH STUDIES 123

In order to address the three abovementioned challenges, we estimate one system of

five equations. The dependent variables, to be simultaneously estimated, are current mis-
match (y1v and y1h) conditioned on being in a new job at the time of the interview (N1 = 1)
with control for initial conditions, namely, mismatch in the first job (y0v and y0h). The
model will have the following structure:
∗
y1v = g′1v y0v + n′1v R1 + l′1v E1 + b′1v X1 + 11v; yv = 1 if yv∗ ≥ 0 and 0 otherwise (3)
∗
y1h = g′1h y0h + n′1h R1 + l′1h E1 + b′1h X1 + 11m; yh = 1 if yh∗ ≥ 0 and 0 otherwise (4)

N1∗ = g′2v y0v + g′2h y0h + b′2 X2 + 12 ; N1 = 1 if N1∗ ≥ 0 and 0 otherwise (5)
∗
y0v = b′3v X3 + 13v ; y0m = 1 ∗
if y0m ≥ 0 and 0 otherwise (6)
∗
y0h = b′3h X3 + 13h ; y0m = 1 ∗
if y0m ≥ 0 and 0 otherwise (7)

where y1v and y1j are only observed when N1 takes the value 1, which entails losing N1 as a
covariate in the prediction of current educational mismatch. Its impact may nevertheless
be obtained from the predicted probabilities that stem from the model. As in the two-
equation system, persistence of educational mismatch is defined by γ1v and γ1h, the
impact of job rotation would be captured by n′1v , and n′1h , and the size of l′1v , and l′1h
will indicate additional mismatch risks related to little accumulated experience. Now
g′2v and g′2h will also contribute to confirming the stepping stone or trap hypothesis: if
positive, they will contribute to the stepping stone hypothesis as it will mean mismatched
graduates are more likely to transit to new positions, presumably in the search for better
matches. If negative, it will give support to the trap hypothesis.
The three sets of additional covariates (X1, X2, X3) are intended to detect heterogeneity
across graduates and their jobs, contributing to predicting their proneness to be ill-
matched in the first and current job and to move across employers. They are displayed
in Table 3.
Gender, age at graduation and field of education and type of programme are key
determinants of all dependent variables. Women could be more prone to mismatch in
graduate jobs if they are less mobile because of family reasons. Older graduates may
be more likely to accept mismatched jobs to undertake personal/family responsibilities
and also be less mobile across jobs if they are reluctant to face non-employment spells
for the same personal / family reasons.
As regards the field of study, we expect both overeducation and horizontal mismatch
risks to be in line with the saturation of the field in the labour market and the transferabil-
ity of the skills of the field (Montt 2017). Thus, compared with humanities graduates,
whose relevant mismatch risks are well documented in the literature (Barone and Ortiz
2011), we expect graduates in occupation-specific fields of study like health or engineer-
ing and other STEM (science, technology, engineering and maths) degrees to be much
less likely to report vertical and horizontal mismatch (as in Acosta-Ballesteros, Rosal,
and Rodríguez-Rodríguez 2018).
Concerning initial mismatch risks, international experiences during the degree or high
marks – proxied by having enjoyed collaboration or excellence grants – might be indi-
cators of abilities and productivity, and should be negatively correlated with initial mis-
match risk. Similarly, work experience as undergraduates via paid employment or
124 C. ALBERT ET AL.

Table 3. Sets of control variables in the system of equations.

Dimension Variables X1 X2 X3
Socio-demographic Gender and age at graduation √ √ √
Place of residence Low, medium, medium-high or high unemployment rates in region of √
residence (ranked in quartiles) or abroad.
Academic features Field of education and type of degree (ISCED 5A; 5B) √ √ √
Type of university (public vs private) √
Undertaking further education at the time of the interview √
Prior experience, Having studied abroad as an undergraduate √
productivity signs Excellence or collaboration grants as an undergraduate √
Employment experience before graduation in (non-)sporadic, (non-)related, √
(part-)full-time jobs.
Internship programmes as an undergraduate √
Current job features Job status and type of contract, part-time vs full-time √
Size of the employer √
The graduate is working abroad at the time of the interview √
First job features Job status and type of contract, part-time vs full-time √ √
The first job took place abroad √ √
First job search The graduate did not have to look for a job // started search upon √
graduation // elapsed time since graduation until the first job
Job search strategies: public employment services, university career services √
/ internship programmes, reviewing ads, contacting employers, temporary
work agencies.
Source: own elaboration.

internships should indicate specific human capital and be related to reduced mismatch
risks in the first job. Also, having studied at a private university often means a higher like-
lihood of having acquired valuable marketable skills and valuable social connections that
may help in finding a well-matched first position in the graduate labour market. We think
that this comprehensive set of variables may compensate for the lack of information
about other features previous to undergraduate education such as the quality of second-
ary education and family background.10 The time taken to find the first job may indicate
urgency in accepting a mismatched position. Also, the strategy employed for the job
search should influence mismatch risks as they would provide information about available
vacancies (Albert and Davia 2018).
As regards first and current job features, we expect jobs that require a high level of
human capital to be less likely to be either part-time or non-permanent, as employers
need to retain highly qualified workers in whose specific human capital they often
invest. Small enterprises are also more prone to create temporary and low-qualified pos-
itions than medium and large firms/organisations, so graduates working in these organ-
isations would face higher mismatch risks. Finally, working abroad often means not using
one’s knowledge or skills because of language barriers and, in the early stages of one’s
career, may be a short-term learning experience.
The likelihood of holding a new position at the moment of the interview is explained
by a combination of previous mismatch determinants (field of education, gender and
age), precariousness in the first job (part-time vs full-time and job status), current partici-
pation in the labour force – which is unlikely if the interviewee is undertaking further edu-
cation at the time of the interview – and employment opportunities around the area of
residence, proxied by unemployment rates. (Table 4).
Given that our aim is to estimate the causal effect of initial mismatch on later one, the
above explained sets of covariates are entered to adjust for confounding. Based on
 JOURNAL OF YOUTH STUDIES 125

theoretical grounds, we have excluded some others since we feared they would be con-
founders and potentially endogenous to initial job match. For instance: the questionnaire
asks about language and ICT skills at the moment of the interview, which graduates could
have improved since graduation as a strategy to find better job matches and reducing
educational mismatch altogether. The same applies to geographical mobility since gradu-
ation, which may be driven by personal and family reasons but also by employment-
related or economic incentives. We have done without those variables to avoid overcon-
trol bias (see Elwert and Winship (2014) for a very illustrative explanation). Still, we need to
accept the identifying assumptions of no unobserved confounding to design our specifi-
cation to address our target in the best possible way. Results will be dealt with caution as
the associational methods deployed here would not identify causality, though.11
The error terms (εm) may be mutually correlated because of unobservable factors that
determine initial mismatch, job mobility and current mismatches. They are normally distrib-
uted with mean 0, variances σm and covariances σjk = σkj (for j,k = 1, 2, 3, 4, 5 and j ≠ k). Off-
diagonal elements of the variance-covariance matrix (Σ) will be ρ12, ρ13, ρ14, ρ15, ρ23, ρ24, ρ25,
ρ34, ρ35 and ρ45. If significant, they would call for a simultaneous estimation of the equation
system via maximum simulated likelihood methods. To that aim, we employ the Stata con-
ditional mixed process estimator (cmp), developed in Roodman (2011).

5. Results
5.1. Multivariate analysis
Table 4 displays the coefficients – expressed as marginal effects, in percentage points – for
the main explanatory variables in the five-equation system12 (the full set was detailed in
Table 3).
Both vertical and horizontal mismatch are quite persistent: after a worker moves to a
new job, initial vertical (horizontal) mismatch is associated with a higher vertical (horizon-
tal) mismatch risk in the new job – around 27 percentage points higher. This result sup-
ports the trap hypothesis. In addition, initial vertical mismatch is associated with a higher
probability of moving across jobs (about 7 percentage points higher), whereas the oppo-
site holds – with the impact being the same absolute size – for initial horizontal mismatch.
This would mean that horizontal mismatch is more trapping than vertical mismatch.
This result is partially explained by the association between horizontal mismatch and
holding a permanent contract (the size of the marginal effect is rather small). In addition,
interviewees older than 35 at the moment of graduation are more likely (3 percentage
points) to experience horizontal mismatch in their first job and less prone to move
across employers (10 percentage points) than under 30-year-old graduates. Some of
them may also have a personal, rather than professional, motivation to study and
remain in the jobs they held before graduation.
Job rotation (proxied by the number of employers upon graduation, taken as a con-
tinuous variable, though topped at value 8) and little employment experience contribute
to both vertical and horizontal mismatches. They nuance the favourable impact of job
mobility on mismatch risks, but the relevant coefficients are rather small (every additional
employer increases mismatch risk by only 0.5 percentage points and little experience
increases it by about 2.5 percentage points).
126 C. ALBERT ET AL.

Table 4. Five-equation system: probability of vertical and horizontal mismatch conditional on job
mobility and with endogenous vertical and horizontal mismatch: marginal effects (expressed in
percentage points).
Vertical Horizontal Vertical Horizontal
mismatch mismatch Works in a mismatch mismatch
(new job) (new job) new job (first job) (first job)
Vertical mismatch in first job 0.267*** 0.074***
(0.004) (0.008)
Horizontal mismatch in first job 0.271*** -0.077***
(0.003) (0.007)
Number of employers 0.005*** 0.006***
(0.001) (0.001)
Less than two years of 0.024*** 0.026***
employment experience (0.003) (0.003)
Women 0.022*** 0.015*** 0.016*** 0.005** 0.002
(0.003) (0.003) (0.003) (0.002) (0.002)
30-34 years old 0.033*** 0.034*** -0.014*** 0.010*** 0.005*
(0.003) (0.003) (0.003) (0.003) (0.002)
35 or more years old 0.045*** 0.065*** -0.099*** -0.017*** 0.030***
(0.004) (0.004) (0.004) (0.004) (0.003)
Health (ISCED 5A) -0.207*** -0.281*** 0.020*** -0.257*** -0.299***
(0.011) (0.011) (0.008) (0.008) (0.008)
Health (ISCED 5B) -0.142*** -0.211*** 0.077*** -0.200*** -0.248***
(0.007) (0.007) (0.007) (0.006) (0.006)
Engineer/architect (ISCED 5A) -0.098*** -0.120*** 0.131*** -0.063*** -0.127***
(0.007) (0.006) (0.007) (0.006) (0.005)
Engineer/architect (ISCED 5B) -0.003 -0.061*** 0.044*** 0.029*** -0.075***
(0.006) (0.006) (0.006) (0.005) (0.005)
Sciences (ISCED 5A) -0.020*** -0.066*** 0.010 -0.026*** -0.069***
(0.007) (0.007) (0.007) (0.007) (0.006)
Social Sciences & Law (ISCED 5A) -0.010* -0.061*** 0.058*** 0.034*** -0.043***
(0.005) (0.005) (0.005) (0.005) (0.004)
Social Sciences (except Education) 0.066*** -0.012** 0.019*** 0.157*** -0.012**
& Law (ISCED 5B) (0.006) (0.005) (0.006) (0.005) (0.005)
Education (ISCED 5B) -0.053*** -0.125*** 0.056*** 0.034*** -0.099***
(0.006) (0.006) (0.006) (0.005) (0.005)

Current job First job features

Internship -0.057*** -0.043*** -0.020*** -0.141*** -0.135***
(0.005) (0.005) (0.004) (0.003) (0.003)
Employee: permanent contract -0.014*** -0.006** -0.139*** -0.024*** 0.010***
(0.003) (0.003) (0.003) (0.003) (0.003)
Employer or self-employed -0.114*** -0.043*** -0.225*** -0.133*** -0.086***
(0.005) (0.005) (0.006) (0.006) (0.005)
Family aid 0.169*** 0.190*** -0.198*** 0.135*** 0.137***
(0.018) (0.017) (0.011) (0.009) (0.008)
Part time 0.077*** 0.057*** 0.050*** 0.127*** 0.095***
(0.003) (0.003) (0.003) (0.002) (0.002)
Work / lives abroada 0.001 -0.014*** 0.183*** 0.032*** 0.041***
(0.005) (0.005) (0.005) (0.005) (0.004)

rho12 rho13 rho14 rho15 rho23

Correlations across errors 1.009*** -0.030 -0.042*** 0.034*** -0.032*
(0.009) (0.018) (0.011) (0.009) (0.017)

rho24 rho25 rho34 rho35 rho45

Correlations across errors -0.065*** -0.021** 0.007 0.073*** 0.911***
(0.008) (0.010) (0.011) (0.011) (0.006)
Number of observations 13507 13507 25205 24170 24170
Goodness of fit Chi-2 p-value - 2 Log-likelihood
71196 0,0000 -323492
Standard errors in parentheses; *** p<0.01, ** p<0.05, * p<0.1;
a
In the estimation of job mobility, the estimate refers to the place of residence at the time of the interview.
Reference group: males who graduated before the age of 30 in a long-cycle programme in arts / humanities. Their first job
took place in Spain, they were full-time employees and had a temporary contract. They were not mismatched in their
first job, worked for fewer than three employers and acquired at least two years of employment experience since gradu-
ation. The rest of the control variables are displayed in Table 3. The coefficients are not displayed for reasons of space
but are available upon request.
Source: EILU-2014.
 JOURNAL OF YOUTH STUDIES 127

Interestingly, women are more exposed to vertical and horizontal mismatch four years
after graduation than men, even though they are slightly more mobile across jobs and
their risk of initial mismatch is not higher than men’s.
The differences observed across fields of study are in line with our expectations: gradu-
ates in health sciences, engineering and sciences are not only less prone to past and
current educational mismatch but also more likely to move to new positions, which
strengthen the stepping stone mediating role of job mobility for them. Graduates in
other social sciences and teacher training (education13 ISCED 5B) tend to experience
higher overeducation than graduates in humanities and arts but lower horizontal mis-
match rates. They are more mobile and their relative gap in overeducation in their
current jobs ends up being much smaller than in the first job.
Working part-time, job status and the type of contract register the expected trends:
permanent contracts are negatively correlated with current vertical and horizontal mis-
match but positively correlated with horizontal mismatch in the first job, as already men-
tioned. Also, self-employment is related to lower vertical and horizontal educational
mismatch risks, in line with Congregado et al. (2016).
Starting one’s graduate employment career abroad entails, as expected, larger mis-
match risks and a higher likelihood of job mobility. In the new job, the difference
between working in Spain and abroad is tiny in size (around one percentage point), posi-
tive for vertical mismatch risks and negative for horizontal ones. The rest of the covariates,
not shown for space reasons but available upon request, are consistent with our expec-
tations and previous evidence.
Finally, almost all the parameters that capture correlation across errors in the equation
systems are significant (the only exceptions being rho13 and rho34), confirming the
appropriateness of the empirical strategy chosen.

5.2. Consistency checks

We have run three consistency checks to test robustness in our specifications. The
results are not included in the manuscript for reasons of space but are available
upon request. First, we redefined vertical and horizontal mismatch in the first and
current jobs. Interviewees who reported that their first/current job required university
education attainment but specified an occupation coded 4 (clerks) or lower (service
workers, etc) in the ISCO-08 classification were reclassified as vertically mismatched.
Graduates who reported that ‘no particular field’ would be appropriate for their
first/current job were considered horizontally well matched. The resulting vertical (hori-
zontal) mismatch rates were about 10 percentage points higher (between 10 and 15
percentage points lower), but the trends in mismatch persistence do not vary
significantly.
The second consistency check consisted of adding an extra dummy to equations (3), (4)
and (5) for simultaneous vertical and horizontal mismatch in the first job, which affects to
23.5% of graduates. In this alternative specification, vertical mismatch is equally persist-
ent: most of this persistence is related to initial vertical mismatch per se and some of it
is due to the combination of both types of mismatch in the first job. As for horizontal mis-
match, persistence seems to be particularly high for graduates who are only horizontally
mismatched. Graduates who experience double mismatch are more likely to overcome it
128 C. ALBERT ET AL.

provided they move across jobs, although they are a bit less likely to move across jobs
than those who suffer horizontal mismatch only.
In the third consistency check, job features were dropped from equations (3) and (4),
which predict current education mismatch, as they might be endogenous to previous
education mismatch and mobility. As a result, in equation (3), initial vertical mismatch,
job rotation and little accumulated experience capture part of the heterogeneity that is
no longer controlled for, and the relevant marginal effects increase slightly. In equation
(4), no significant changes are found.
We may conclude that the results are quite robust across specifications.

5.3. Predicted probabilities

Our empirical strategy entails selection on job mobility. To capture its impact on ulterior
education mismatch risks, we compute the predicted probabilities of education mismatch
out of the aforementioned specification and display them in Table 5, where differences
across fields of education are also shown. The average computed risk of current vertical
(horizontal) job mismatch for job movers is 12 (6) percentage points lower than for first
jobs. The predicted probability of holding a new job at the time of the interview is a
bit higher than 50%, and the likelihood of mismatch amongst initially mismatched job
movers is also about 50%.
In order to identify the potential impact of job rotation and little employment experi-
ence, we display the predicted probabilities of current mismatch in two extreme scen-
arios: fewer than three employers upon graduation and more than two years in
employment (minimum rotation, maximum experience), and five or more employers
and less than two years in employment (maximum rotation, minimum experience). On
average, the risk of persisting in overeducation (horizontal mismatch) in graduates with
maximum rotation, minimum experience is about 12 (8) percentage points higher than
among those with minimum rotation, maximum experience.
There are large disparities across education and types of programmes (ISCED 5A and
ISCED 5B) in both initial mismatch risk and its reduction induced by mobility. Graduates
in health sciences (ISCED 5A) not only experienced the lowest initial mismatch risks but
also benefitted most from job mobility, with only 18.7% (16.5%) of those initially in vertical
(horizontal) mismatch remaining mismatched in their current job. Graduates in social
sciences different from 5B education programmes suffered the highest initial vertical mis-
match rates (close to 60%), and graduates in humanities and arts had the largest initial
horizontal mismatch rates (close to 50%). In both cases, the rate of mismatch reduction
thanks to job mobility is lower than the average. Moreover, the probability of moving
to a new job is a bit lower in fields particularly affected by initial mismatch, which contrib-
utes to a trap effect for graduates in those fields of education.
Finally, the impact of job rotation and employment experience on ulterior edu-
cational mismatch also varies across fields of education, and its effect is more severe
in the fields of education less affected by mismatch. Mismatch risks are most vulnerable
to job rotation in health (ISCED 5A) graduates followed by engineers and graduates in
science, while the impact of job rotation is less severe than the average in graduates in
arts and humanities and, to a lesser extent, social sciences, where mismatch risks are
quite high.
 JOURNAL OF YOUTH STUDIES 129

Table 5. Predicted probabilities of mobility across jobs and vertical and horizontal mismatch in first
and current (new) job.
In first Job In new min rotation, max max rotation, min
Vertical mismatch job mobility job exper exper
Overall 0.376 0.545 0.254 0.203 0.377
Match in first job 0 0.533 0.101 0.083 0.149
Mismatch in first job 1 0.564 0.495 0.458 0.575
In first Only initially mismatched graduates
job
Health (ISCED 5A) 0.077 0.534 0.187 0.174 0.424
Health (ISCED 5B) 0.164 0.584 0.305 0.285 0.345
Engineer/architect (ISCED 5A) 0.221 0.661 0.313 0.284 0.376
Engineer/architect (ISCED 5B) 0.378 0.559 0.484 0.453 0.586
Sciences (ISCED 5A) 0.348 0.538 0.481 0.454 0.572
Social Sciences & Law (ISCED 5A) 0.396 0.580 0.494 0.457 0.572
Social Sciences (except Education) & 0.587 0.522 0.637 0.605 0.686
Law (ISCED 5B)
Education (ISCED 5B) 0.460 0.589 0.467 0.432 0.531
Arts / Humanities (ISCED 5A) 0.427 0.498 0.549 0.517 0.595

Horizontal mismatch In first Job In new min rotation, max max rotation, min
job mobility job exper exper
Overall 0.291 0.545 0.229 0.189 0.343
Match in first job 0 0.559 0.111 0.096 0.159
Mismatch in first job 1 0.509 0.526 0.500 0.584
In first Only initially mismatched graduates
job
Health (ISCED 5A) 0.055 0.495 0.165 0.161 0.348
Health (ISCED 5B) 0.117 0.527 0.314 0.308 0.336
Engineer/architect (ISCED 5A) 0.166 0.580 0.409 0.385 0.472
Engineer/architect (ISCED 5B) 0.276 0.515 0.523 0.498 0.588
Sciences (ISCED 5A) 0.308 0.497 0.529 0.507 0.611
Social Sciences & Law (ISCED 5A) 0.326 0.530 0.535 0.505 0.604
Social Sciences (except Education) & 0.407 0.476 0.631 0.616 0.679
Law (ISCED 5B)
Education (ISCED 5B) 0.314 0.523 0.452 0.425 0.497
Arts / Humanities (ISCED 5A) 0.476 0.449 0.661 0.648 0.694
Source: EILU-2014 (INE).

6. Discussion
From our empirical exercise we find that half of the graduates who experienced mismatch
in their first job found a well-matched position later on, with many mismatched positions
acting as stepping stones towards appropriate jobs. On the other hand, their risk of edu-
cational mismatch four years after graduation is much higher than for those who entered
the labour market in a well-matched position. This persistence four years after graduation
supports the trap hypothesis, in line with prior evidence for Spain (Acosta-Ballesteros,
Rosal, and Rodríguez-Rodríguez 2018). The intensive job rotation linked to the heavy
use of temporary contracts in Spain and the low accumulation of specific human
capital challenge, though only partially, the ability of job mobility to mitigate mismatch
persistence.
The Job Mobility theory expects mismatched workers to move strategically across
employers. The negative correlation between horizontal mismatch in the first job and
ulterior job mobility would indicate that horizontal mismatch is more entrapping than
vertical mismatch. This result was only partially explained by the positive correlation
between holding a permanent position and horizontal mismatch, in line with Ortiz
130 C. ALBERT ET AL.

(2010) for vertical mismatch. The author explained this puzzling connection by the scar-
city of permanent positions in Spain. Moreover, horizontally mismatched workers suffer a
wage penalty only when they are also overqualified (Montt 2017), which would ease
acceptance – and retention – of horizontally mismatched positions. The sociodemo-
graphic profile of horizontally mismatched graduates (older than the average) would
also partially explain this result.
Graduates in the fields of education least (most) affected by initial mismatch tend to
benefit most (least) from job mobility. This result differs from Verhaest and Van der
Velden (2013), who, like us, found lower initial overeducation risks in graduates from
occupational-specific fields, but also lower persistence risks in graduates from general
fields.14 In this case, there seems to be a double advantage for occupation-specific
fields of education: they protect from initial mismatch and favour ulterior correction of
mismatch via job mobility.
Our results are consistent with several features of the Spanish labour market. First,
there are the structural lack of graduate jobs and the high unemployment rates (see
Meroni and Vera-Toscano (2017) for a discussion) that push many graduates to accept
ill-matched positions to avoid unemployment. In view of the excess supply of graduate
labour, employers increase hiring standards and often take university degrees as signs
of candidates’ productivity and ability to learn new skills. At the same time, strong imbal-
ances prevail between the distribution of supply and demand across fields of education
with excess supply mainly in social sciences and humanities and deficits in STEM-related
careers, direly needed to cope with the potential demand for certain occupational profiles
in the future (Caprile et al. 2015).
Our results also reflect the segmentation between temporary and permanent workers
in the Spanish labour market (Ortiz 2010) and the potential impact of strictness in employ-
ment protection legislation argued in Verhaest and Van der Velden (2013). High tempor-
ality and unemployment rates push many graduates to accept horizontal mismatch in
exchange for employment stability. Recurrent temporary contracts mean intensive job
rotation, often across occupations and sectors, reducing the accumulation of specific
human capital. This segmentation intensifies inequality in the graduate labour market
in several outcomes like educational mismatch and, eventually, wages (Suleman and Fig-
ueiredo 2019).

7. Conclusions
This paper has analysed persistence in vertical and horizontal educational mismatch in the
early stages of the employment career among university graduates in Spain, with particu-
lar attention paid to the role of job mobility in its correction. The empirical strategy
employed allows for control for initial conditions (mismatch in the first job as a graduate)
and for endogenous selection into a new job. We find mixed evidence that indicates per-
sistence in education mismatch, although job mobility also has a relevant role in its
correction.
Although our approach entails adding interesting nuances to previous evidence, the
present study also has limitations. For instance, the causal mechanism driving transitions
towards well-matched positions from ill-matched ones via job mobility is not captured by
our analysis. The strategy employed here measures, directly and indirectly, via job
 JOURNAL OF YOUTH STUDIES 131

mobility, correlations across the relevant variables rather than genuine causal effects.
Moreover, the data set lacks good information on graduates’ abilities and skill15 endow-
ments and also family background. This limits our ability to capture genuine educational
mismatch, so our results might be biased because of some of the measurement issues
mentioned in Section 3.2.1. Finally, the interviewees in EILU-2014 graduated during the
Great Recession, which must have constrained their chances of overcoming initial mis-
match via upward occupational mobility. Unfortunately, it is not possible to disentangle
which part of the persistence in educational mismatch results from the overall situation of
the Spanish labour market.
The persistence observed in education mismatch calls for public policies that address the
determinants of early mismatch in the graduate labour market. One example of such pol-
icies would be investments that favour the knowledge economy to enhance the demand
for high-skilled workers and encourage youths to pursue STEM careers. Also, improving
graduates’ marketable skills, job search efficiency and geographical mobility to better
accommodate demand and supply would be helpful in this regard. Finally, policies designed
to remedy employers’ intensive use of temporary contracts in Spain would contribute to
ensuring mobility across jobs corrects rather than exacerbates educational mismatch risks.

Notes
1. According to OECD education statistics, the share of 25–34-year-olds with tertiary education
jumped from 9.8% in 1981 to 35.43% in 2001, and in 2019, reached 46.5%, right in line with
the OECD average.
2. Barone and Ortiz (2011) describe how differences in the structure of productive systems drive
different overeducation rates in recent university graduates across European countries.
3. Congregado et al. (2016) identify a few studies (Groot and Maassen Van Den Brink (2003) in
the Netherlands, Frei and Sousa-Poza (2012) in Switzerland, and Carroll and Tani (2013) in
Australia) where high degrees of mobility out of mismatch are found, contrary to most of
the evidence.
4. It is an on-line platform that collects information about all the institutions in the Spanish uni-
versity system.
5. Unfortunately, the information from university records does not include entry marks, second-
ary education pursued or family background. It would have been very useful for understand-
ing graduates’ selection of the field of education (see Vila, Garcia-Aracil, and Mora 2007),
which is crucial in the prediction of education mismatch risks upon graduation.
6. Pre-Bologna degrees were either short (three years, diplomado or ingeniero técnico) or long
(five years, licenciado or ingeniero superior). Under the current system, most degrees are
four years long, except for degrees in medicine and architecture. They also differ from pre-
vious degrees because they involve more internships and the compulsory completion of a
final degree dissertation.
7. Some research combines overeducation with skills mismatch (see McGuinness, Pouliakas, and
Redmond (2018) for a survey of skill mismatch). This may be relevant as poorly skilled individ-
uals may be or feel formally overeducated but underperform in skills; they would therefore
not be genuinely overeducated (Leuven and Oosterbeek 2011). For instance, Mateos-
Romero and Salinas-Jimenez (2017) estimated that between one fourth and one half of
adult university graduates in Spain perceived as overeducated were only apparently overe-
ducated because of their low level of cognitive and non-cognitive skills (captured from
PIAAC – OECD Programme for the International Assessment of Adult Competencies –
data). We do not undertake this approach here, but this evidence means we need to be cau-
tious about the limits of our subjective measure of vertical mismatch.
132 C. ALBERT ET AL.

8. This large difference is in line with the one found in previous evidence, such as in Verhaest
and Van der Velden (2013) and Acosta-Ballesteros, Rosal, and Rodríguez-Rodríguez (2018).
9. We acknowledge that job rotation may be endogenous to initial mismatch because job mobi-
lity is, but, for the sake of simplicity, we will control only for endogenous mobility across
employers.
10. However, we acknowledge that if this variable were not a good proxy for these unobserved
confounding factors - or if other important confounders remained unobserved - our identify-
ing assumption would be violated and we would overestimate the effect of initial mismatches
on later ones, as they would be partially caused by unobserved background features not cap-
tured by the type of university.
11. See Hernán (2018) for an appealingly argument in favour of aiming to detect causal links in
research questions while not claiming associational results to be unbiased measures of a
causal effects and paying attention to confounding adjustment.
12. We have first computed the bivariate probit model for current mismatch risks with exogenous
initial conditions and exogenous job mobility (N1), which was proven to reduce current mis-
match rates. The estimates for the bivariate probit and the complete sets of coefficients for
the five equations system are not shown for reasons of space but are available upon request.
13. Within short-cycle social sciences programmes, we select out graduates in education (infant
and primary school teachers-to-be) because this training is very occupation-specific and less
affected by mismatch risks.
14. They explain their result by the generic skills the latter acquire through job mobility, skills
which will help them to gain specific jobs in mismatched positions and be more successful
than others in finding well-matched positions afterwards.
15. In fact, it does have information about English language skills and ICT skills (both self-
reported), but we have omitted it from our specifications because we could not know the
extent to which the level of skills reported at the interview was the same as before the
first job. Interviewees might have improved them because of initial educational mismatch
in order to reduce their ulterior mismatch risks in subsequent jobs.

Disclosure statement
No potential conflict of interest was reported by the author(s).

Funding
This work was supported by Ministry of Economy and Competitiveness [grant number PID2020-
118355RB-I00] and by Universidad de Castilla-La Mancha [grant number 2021-GRIN-31218], co-
funded with ERDF funds.

ORCID
Cecilia Albert http://orcid.org/0000-0002-6805-3526
Maria A. Davia http://orcid.org/0000-0001-9551-6111
Nuria Legazpe http://orcid.org/0000-0002-2161-3768

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Appendix

Table A1. Mean values for dependent and the main explanatory variables in multivariate analysis.
Mismatch at current Current job differs from first Mismatch at first
(new) job one job
Vertical mismatch in current job 0.245
Horizontal mismatch in current job 0.223
Current job differs from first one 0.543
Vertical mismatch in first job 0.390 0.374 0.374
Horizontal mismatch in first job 0.286 0.292 0.289
Number of employers (mean) 3.201
Number of employers (s.d.) 1.697
Less than two years of work experience 0.226
Women 0.613 0.611 0.612
Aged <30 at graduation 0.633 0.596 0.605
Aged 30–34 years-old at graduation 0.260 0.256 0.255
Aged 35 or more at graduation 0.107 0.148 0.141
Health (ISCED 5A) 0.044 0.048 0.048
Health (ISCED 5B) 0.093 0.086 0.088
Engineer/architect (ISCED 5A) 0.108 0.094 0.094
Engineer/architect (ISCED 5B) 0.115 0.118 0.118
Sciences (ISCED 5A) 0.047 0.048 0.049
Social Sciences & Law (ISCED 5A) 0.252 0.252 0.250
Social Sciences (except Education) & Law 0.124 0.135 0.134
(ISCED 5B)
Education (ISCED 5B) 0.160 0.155 0.156
Arts / Humanities (ISCED 5A) 0.056 0.064 0.063
Part time work 0.246 0.340 0.343
Internship 0.098 0.200 0.201
Employee – temporary contract 0.419 0.263 0.253
Employee – permanent contract 0.388 0.471 0.480
Employer or self-employed 0.091 0.053 0.053
Family aid 0.004 0.013 0.013
Work abroad 0.078 0.063 0.053
Number of observations 13,507 25,205 24,170
Note: Only mean values for dependent variables and the covariates for which marginal effects have been shown in
Table 4 are displayed here. The description of the rest of the covariates (see Table 3) are available upon request.
Source: EILU-2014 (INE).