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Why Is Unemployment Higher among the Educated?
The unemployment rate among the educated is not only higher compared to the uneducated, it also increases with higher levels of education. This article explores whether the factors responsible for unemployment among the educated differ from the uneducated based on a multinomial probit model. Results indicate that youth, both educated and uneducated, are more likely to be unemployed than older age groups. One of the reasons for higher unemployment among the educated is that the educated are not willing to join in low-grade informal jobs, but at the same time, sufficient regular salaried jobs are also not available for them. Both educated and uneducated individuals with vocational training (formal or informal) are more likely to find jobs. Besides promoting skills through technical and vocational education, creation of jobs through enhancing capital formation is important to reduce both educated and uneducated unemployment.
The unemployment rate among the educated is not only higher compared to the uneducated, it also increases with higher levels of education. This article explores whether the factors responsible for unemployment among the educated differ from the uneducated based on a multinomial probit model. Results indicate that youth, both educated and uneducated, are more likely to be unemployed than older age groups. One of the reasons for higher unemployment among the educated is that the educated are not willing to join in low-grade informal jobs, but at the same time, sufficient regular salaried jobs are also not available for them. Both educated and uneducated individuals with vocational training (formal or informal) are more likely to find jobs. Besides promoting skills through technical and vocational education, creation of jobs through enhancing capital formation is important to reduce both educated and uneducated unemployment.
