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THE MARKET IS SEEING AN INCREASINGLY OVERQUALIFIED LABOUR FORCE

I’m too sexy for my job...

THERE could be many reasons why a person with a university degree is working in a fast-food restaurant. In Slovakia people who are too good for their jobs, so to speak, haven’t been a problem for the labour market, but this may be changing. “It happens quite often that people who have a university degree apply for positions where only a secondary school graduation is required,” Marcela Glevická from the Profesia.sk job portal told The Slovak Spectator. There are professions in Slovakia’s job market where more than half of the people have a higher level of education than is required. The ranking is topped by bank loan specialists, 61 percent of whom are university graduates. Other professions include librarians, tour guides and physiotherapists.

THERE could be many reasons why a person with a university degree is working in a fast-food restaurant. In Slovakia people who are too good for their jobs, so to speak, haven’t been a problem for the labour market, but this may be changing.

“It happens quite often that people who have a university degree apply for positions where only a secondary school graduation is required,” Marcela Glevická from the Profesia.sk job portal told The Slovak Spectator. There are professions in Slovakia’s job market where more than half of the people have a higher level of education than is required. The ranking is topped by bank loan specialists, 61 percent of whom are university graduates. Other professions include librarians, tour guides and physiotherapists.

An overqualified labour force occurs naturally to some extent, just like the natural unemployment rate. Even though this is not a burning issue in the Slovak labour market, it is becoming a problem, mainly due to supply exceeding demand over the long term, but also because university education is becoming more accessible, market watchers say. A worker is overqualified for his or her job when his or her skills, education, competence and knowledge are higher than what the job position requires.

As the unemployment rate rises and the number of available jobs drops, workers with higher qualifications have an advantage in that they can be hired not only for jobs that match their qualifications, but also those for which they are overqualified. In times of economic hardship, the fear of being unemployed, losing one’s income security and falling into the net of the social system can motivate people to take a job that requires lower qualifications and in turn offers a lower salary.

Who?


Most job seekers who take on work for which they are overqualified are not well established on the labour market, like fresh graduates and immigrants. In the case of the latter, down-skilling is caused by barriers like a lack of recognition of their qualifications or limited proficiency in the local language, according to Lucia Mýtna Kureková, an analyst with the non-governmental Slovak Governance Institute (SGI).

As for graduates, in most European countries, including Slovakia, the difficulties people face when entering the labour market push them into accepting a job at any cost, Mýtna Kureková noted, adding that this is also why they are usually willing to accept temporary contracts.

Profesia’s Glevická confirms that inexperienced graduates are more likely to work in positions for which they are overqualified, compared to people who have a university degree and experience on the labour market. This mainly concerns positions like tax advisor assistant, personal consultant, legal clerk, marketing specialist, recruiter or webmaster. As for university graduates, those who are most willing to apply for a job for which they are overqualified are those with a degree in economic fields, as opposed to, for instance, graduates in IT-related fields, who are more likely to get a job they studied for.

In some cases, however, the decision to take up such work is driven by personal reasons.

“If a person is unable or unwilling to move to a different region or country for work, they are likely to respond to openings available in the given locality,” Mýtna Kureková told The Slovak Spectator.

Miroslav Štefánik from the Institute of Economic Research of the Slovak Academy of Sciences also stresses this individual component when deciding on a low-qualified job.

“Sometimes people simply prefer, for instance, a shorter commute over adequate application of their qualification,” Štefánik told The Slovak Spectator. “If this phenomenon starts occurring more often, or it has a growing tendency in the long term, we can presume that the individual decisions of the jobseekers reflect some systemic changes.”

Why?


One reason for over qualification in the Slovak labour market is the increasing accessibility of university education, with the share of university graduates having drastically increased in the last 15 years, from about 20 percent to more than 50 percent today, according to Michal Páleník of the Employment Institute, a non-governmental think tank.

Furthermore, Slovakia committed itself to increasing the proportion of 30-34 year olds who have completed tertiary or equivalent education to at least 40 percent, as part of the Europe 2020 strategy.

“Combine that [commitment] with the fact that a bachelor’s degree practically doesn’t exist in Slovakia, and you get a deadly combination,” Páleník told The Slovak Spectator, explaining that 90 percent of bachelor’s graduates continue their studies at the master’s level.

Moreover, in Slovakia and the Czech Republic there are almost no underqualified people. In Slovakia, only about 5 percent of the population finishes their education at the primary level, which is very few compared to other countries, and thus the statistics are slightly shifted, Páleník noted.

There are, however, discrepancies between primary and secondary education in Slovakia and other European countries.

“Those who finish secondary school in Slovakia would hardly make it to the end of primary school in Germany,” Páleník said.

The same discrepancies that make the labour markets difficult to compare are caused by differences in the classification of jobs. For example, the job of a hospital nurse in Slovakia is different from elsewhere in Europe.

What is abroad?


Over qualification and under qualification both occur in all industrially developed countries, said Eneke Hanzelová, a researcher from the governmental think tank Institute for the Research of Labour and Family, citing the OECD report from 2005 by Glenda Quintini, who claims that in the OECD an average of over 25 percent of workers are overqualified for their jobs, while over 22 percent are underqualified. Slovakia is one of the few countries where the rate of underqualified and overqualified workers is well below the OECD average, with the underqualified representing less than one in 10 workers.

Until recently, Slovakia did not belong among those countries with an increasing overqualified work force compared with the rest of Europe, Štefánik noted, citing the example of France, where the problem is much more prevalent and also better researched.

“There are however good reasons to believe that the rate of overqualified people in Slovakia is growing,” Štefánik said.

Demanding employers?


Market watchers agree that it is natural for employers to look for the best of what the market has to offer.

“In most countries an attained education degree, but also the field, signal certain qualities to employers,” Mýtna Kureková said. “The higher the formal qualification is, the better attributes the worker is considered to have. In other words, employers can have a ‘better quality’ employee.”

“The employer acts rationally by trying to get the best person for less money, and due to the high unemployment rate this is possible,” Páleník said, adding that with a lower unemployment rate employers would have to compete for job seekers and the situation would be different.

For employers, however, hiring an overqualified candidate can reduce the risk of hiring a person with insufficient knowledge and skills, especially if the education system is underperforming, Mýtna Kureková noted. In Slovakia, this is the case with foreign language skills, which many foreign companies require, but may be less likely to find in candidates with only a secondary education.

“From this perspective, only tertiary educated graduates have all the skills needed for a given position,” Mýtna Kureková said.

What about the market then?


Employing overqualified people however can still have a negative impact on the labour market.

“Metaphorically speaking, university graduates steal jobs from secondary school graduates, who in turn steal jobs from primary school graduates, and those then have nobody to steal from, and that is the problem,” Páleník said.

Employers benefit from this situation in that they can be pickier when hiring new workers, or less generous with their salaries, Štefánik noted. Those who suffer the most are, on the other hand, people with lower qualifications, who get pushed out of the market. If this occurs over the long term, as it does in Slovakia, it increases the long-term unemployment rate. Slovakia’s is the highest in the EU – 9.4 percent compared to the 4.6-percent EU average, as reported by the Employment Institute.

“This change can have a particularly painful effect on older individuals with secondary and lower education, who have lost their long-term job and now they need to compete with younger, cheaper and better educated people on the market,” Štefánik said.

Hanzelová admits that the flexibility of higher-qualified workers can lower the chances of people with lower qualifications finding a job. But there are some considerable eventualities that might prevent overqualified workers from getting a job, too. Firstly, many employers tend to hire job candidates who match the requirements for the job position they apply for.

“One of the concerns of employers when hiring workers who are overqualified is their salary demands and the possibility they will become unmotivated and dissatisfied with their job tasks,” Hanzelová told The Slovak Spectator.

At the same time, many workers with higher qualifications prefer to wait for a job position that matches their qualifications. This is illustrated by the results of the Labour Force Survey of the Slovak Statistics Office, which show that one in seven to eight people who have been unemployed for up to one year have a university degree.The impact on the economy in general is that human capital is underutilised, according to Mýtna Kureková.

“Resources spent on providing education and skills to people who then end up performing jobs for which they are overqualified can be considered wasted,” she explained, but added that only viewing the situation from an economic perspective can be too narrow, as a skilled society has other, broader benefits.

Topic: Career and HR


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