Education-occupation mismatch in the context of informality and development
Using household data from 15 countries in Latin America and Africa, this paper explores
linkages between informality and education-occupation matching. The paper applies
a unified methodology to measuring education-occupation mismatches and informality,
consistently with the international labour and statistical standards in this area.
The results suggest that in the majority of low- and middle-income developing countries
with available data, workers in informal jobs have higher odds of being undereducated
as compared to workers in formal jobs. Workers in formal jobs, in contrast, have higher
chances of being overeducated. These results are consistent for dependent as well
as for independent workers. They also hold for men and for women according to the
gender-disaggregated analysis. Moreover, in the majority of countries considered in
this paper, the matching-informality nexus is also related to the extent of informality
in a given area: in labour markets with higher informality, informal workers in particular
have a higher chance of being undereducated. The paper discusses policy implications
of these findings.