The Incidence and Wage Effects of Overskilling Among Employed VET Graduates

When the skills workers have do not match the skills that jobs require, a number of negative labour market outcomes can occur, including productivity and efficiency losses, lowered earnings and reduced job satisfaction. Using data from the Household Income and Labour Dynamics in Australia (HILDA) survey, this study examines the degree of job mismatch experienced by workers. The mismatch between the perceived skill level of the worker and the skill level of the job is considered as overskilling. The report finds that workers with vocational qualifications, particularly at the certificate III or IV level, are less likely to experience overskilling.