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Overqualification and Youth Self-Employment in Russia

Student: Orifjon Kurbonov

Supervisor: Natalia Volkova

Faculty: St.Petersburg School of Economics and Management

Educational Programme: Management (Bachelor)

Final Grade: 9

Year of Graduation: 2020

The increase in demand for education in recent times caused much instability in labor markets. The number of young people working in jobs which are inconsistent with their education, or, more seriously, the number of unemployed youths is rising rapidly across all over the world and, also, Russian Federation is not an exception. The previous studies have merely focused on the effects of education-job mismatch on several job-related outcomes such as wage penalties, job dissatisfaction, career mobility, job turnover, etc. This paper is aimed to expand the understanding of the overqualification problem in Russia and explore whether Russian self-employed youth tend to experience education-job mismatch more than wage employees. Research is based on data from the Comprehensive Monitoring of Living Conditions (CMLC) coordinated by The Federal State Statistics Service of the Russian Federation (Rosstat) in 2018. Following the availability of data in the dataset, this paper applies an empirical (objective) method of measuring job-education mismatch, which results in two categories of mismatch - underqualification and overqualification. Next, using sample data for Russian youth which consists of 16 233 individuals aged 20-34, the probit regression model was chosen to explore the main goal of the study. Overall, this paper includes 6 regression models, which can be divided into 2 broad groups. First, the regression analysis the effect of mismatch on self-employed youth aged 20-29, 20-30, and 20-34, including individuals living in centralized regions of Russia (Moscow, Moscow Oblast, Saint-Petersburg). Second, regression tests the same effect in three age categories but excluding individuals living in three centralized regions mentioned above. Finally, the results of all 6 models present that self-employed youth in Russia are more likely to experience an education-job mismatch compared to their colleagues working in paid jobs. All models are almost identical with slight differences in control variables, however, the age group of 24-34 is more likely to be underqualified compared to other age groups. Besides, being underqualified seems to have a higher effect on being self-employed.

Full text (added May 31, 2020)

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