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Over-qualification of tertiary-educated migrants from the Americas

Although emigration of migrants from the Americas is commonly associated in the public mind with lesser-skilled migration, a not inconsiderable number of tertiary educated migrants have also migrated to OECD countries. Generally such migrants are more likely to use formal channels of migration and are also in a better position to finance their move to another country. However, recent evidence suggests that many highly educated labor migrants, at least in European countries, were recruited from within the country of destination (OECD 2014), which contradicts the standard recruitment-from-abroad model underlying much immigration regulation. Some of these may be irregular migrants, but some may have arrived as tourists or on visits to family and friends and been exposed to or sought interesting job opportunities after entry. Likewise, many highly educated migrants arrive as family or humanitarian migrants or as international students and eventually make their way into high-skilled jobs. Indeed, evidence from the same OECD study suggests that more high-skilled jobs are filled by family and humanitarian migrants and international students than by labor migrants.

Still, not all tertiary-educated[1] migrants are hired into high-skilled jobs. Some may take on employment which is normally carried out by persons of a lower educational level or for which the formal educational entry requirements are lower than their own level of education (see Box 3). Such persons are said to be “overqualified” for the jobs for which they have been hired, although in practice there may be legitimate reasons for this. The proverbial example is that of a migrant with a PhD who works as a taxi driver. Such situations may occur if the migrant has only an elementary knowledge of the host-country language, enough to get by in an occupation requiring limited language proficiency, but not enough to be able to work at his/her level of education, to draft documents, do talks or presentations, negotiate with clients, etc. 

However, language proficiency is not the only issue underlying over-qualification. Some workers with high credentials may prefer working in jobs which are less taxing; others may lower their expectations in the face of a difficult labor market or of financial need. It is important to note that over-qualification is also not restricted to immigrants. A significant proportion of even native-born tertiary-educated workers in all countries are overqualified for the jobs which they are doing (OECD 2014). In addition, the over-qualifications rates of immigrants, although always higher for immigrants, are highly correlated across occupations to those of non-immigrants. Indeed the differences in over-qualification rates across occupations are larger than those between immigrants and non-immigrants within occupations.[2]  

Under-qualification also exists, that is, persons holding jobs for which they do not appear to have the normal required qualifications. This can occur, for example, if a person entered an occupation at a time when the entry-level qualifications were lower and acquired the skills required today through learning on the job or through experience. However, we will not be addressing under-qualification in this section, which will be focusing strictly on overqualified tertiary-educated immigrants. In addition, the emphasis will be on those employed. Although unemployment among tertiary-educated persons could be said to be the ultimate in over-qualification, our interest here is more on the situation of job-holders than on persons unemployed, a group which includes the lesser educated, who would then also be deemed overqualified if our definition were based on this status as well.  

Box 3. Classifying the skill level of jobs

In order to be able to determine if a person is overqualified for a particular job, the skill level of the job must be known. How is this determined?

The statistics presented in this section are based on labor force surveys and the classification of occupations in such surveys is generally derived from a description of the occupation provided by the survey respondent and its subsequent categorization into a formal occupational classification system.  

As it happens, the International Standard Classification of Occupations (ISCO) includes a skill dimension, related to the entry-level educational level required for a job (ILO 2012). Now this may vary by country to a certain unknown extent; it is assumed here that the extent of this variation is small and that the statistics are reasonably comparable across countries.

The European Union Labor Force Survey on which the statistics for European countries are based collects occupational data using the ISCO classification, so that the job skill level for statistics from the European Union come directly from the skill level defined in ISCO. The high-skill level corresponds to jobs whose normal entry-level qualification is a tertiary degree (groups 1, 2 and 3 in the 1-digit ISCO classification).

The United States American Community Survey, however, applies a national classification system (the SOC, Standard Occupational Classification), which does not include a skill dimension per se. However, it does include a number of groups, whose occupations are held largely by persons with tertiary degrees. These are management, business and financial occupations (66% with tertiary), on the one hand, and professional and related occupations (79% with tertiary), on the other.  Two other occupations groups have significant numbers of tertiary-educated jobholders, namely, sales and related occupations (35% with tertiary), and office and administrative support occupations (31% with tertiary), but without further information, it is difficult to know whether certain occupations in these large groups may or may not be high-skilled occupations.

Because of the differences in the occupational classifications in the data sources used for European Union and United States statistics, the indicators shown in Table 12 cannot be considered fully comparable. Readers are cautioned against drawing conclusions comparing directly outcomes in European countries and in the United States. Comparing results relative to the native-born in each region is more appropriate.

Even in this case, however, statistics for the native-born in European countries may be somewhat misleading. The reason is that they cover the native-born in all European countries, whereas over 40% of employed tertiary-educated immigrants live in Spain (Table 12). This is almost 4 times Spain’s share of the employed tertiary-educated native-born. In other words, the labor market to which many tertiary-educated immigrants from the Americas are exposed is more similar to that of Spain than to that of Europe as a whole, where the over-qualification rates of tertiary-educated graduates tend to be much lower.

Table 12. Tertiary-educated employed persons from the Americas and over-qualification rates in Spain and other European OECD countries, 2011-2013

  Tertiary-educated employed Overqualification rate
Destination country/region Native-born Immigrants from the Americas Native-born Immigrants from the Americas
  Percent of total in country/region   Percent of employed tertiary  
Spain 11.06107573844 40.499666614252 33.299857788325 53.306275627349
Other European OECD countries 88.93892426156 59.500333385748 18.092393195602 24.336888343753
All countries 100 100 19.774502372099 36.069393613801

 

In 2011-2013 there were close to 870 thousand tertiary-educated persons from the Americas employed in European OECD countries (Table 13), but close to three times this number in the United States (2 633 000).  Mexico represented almost a quarter of the latter and Canada about an eighth. There were more tertiary-educated employed in the European Union than in the United States only among immigrants from the Southern Cone (52%). In all other regions and indeed most countries, the tertiary-educated employed in the United States are much more numerous.

Table 13. Over-qualification among employed tertiary-educated immigrants from the Americas in the European Union and the United States, 2011-2013

Origin country Number of employed tertiary-educated immigrants (average 2011-2013) Employed tertiary-educated immigrants as a percentage of all employed immigrants (average 2011-2013) Change in number of employed tertiary educated immigrants from 2007-2009 to 2011-2013 Overqualification rate of employed tertiary-educated immigrants (2011-2013)
  In European Union In United States In European Union In United States In European Union In United States In European Union In United States
Canada 66200 303500 59 63 28 2 16 23
United States 167500 na 74 na 31 na 14 na
Canada and the United States 233700 303500 69 na 30 na 15 na
Antigua and Barbuda nr 5500 nr 38 nr nr nr nr
Bahamas nr 9200 nr 46 nr 5 nr nr
Barbados nr 12800 nr 39 nr 2 nr 39
Cuba 34200 190300 48 34 8 2 49 48
Dominica nr 6700 nr 35 nr 3 nr nr
Dominican Republic 9700 128500 13 24 -21 23 60 59
Grenada nr 7600 nr 37 nr 12 nr nr
Guyana nr 55400 nr 35 nr 4 nr 39
Haiti nr 101400 nr 29 nr 4 nr 48
Jamaica 23200 161700 35 37 40 12 20 38
Saint Kitts and Nevis nr nr nr nr nr nr nr nr
Saint Lucia nr nr nr nr nr nr nr nr
Saint Vincent and Grenadines nr nr nr nr nr nr nr nr
Trinidad and Tobago nr 57800 nr 40 nr 15 nr 39
Suriname 26700 na 26 na 13 na 20 na
Caribbean 118700 747100 30 32 14 9 33 46
Belize nr 10700 nr 39 nr 8 nr nr
Costa Rica nr 18000 nr 35 nr 11 nr 43
El Salvador nr 86700 nr 10 nr 5 nr 62
Guatemala nr 60600 nr 10 nr 12 nr 61
Honduras nr 40300 nr 12 nr 4 nr 64
Mexico 28500 639100 76 9 11 9 27 55
Nicaragua nr 45100 nr 28 nr 4 nr 53
Panama nr 37600 nr 45 nr 5 nr 42
Central America 47200 938000 43 10 10 9 36 55
Bolivia 31100 22000 20 41 28 10 79 50
Colombia 73600 181200 27 42 22 19 46 46
Ecuador 36100 67200 10 24 -35 9 79 53
Peru 57900 109100 26 39 27 8 58 54
Venezuela (Bolivarian Republic of) 65000 77900 52 61 63 20 32 40
Andean Region 263700 457400 23 39 17 14 54 48
Argentina 88700 50400 43 47 -9 1 33 29
Brazil 68000 97500 28 42 33 11 36 41
Chile 28100 27400 33 48 -13 8 43 36
Paraguay 9300 nr 18 nr 44 nr 88 nr
Uruguay 12000 7600 25 24 -22 -7 61 nr
Southern Cone 206100 186900 32 43 1 7 40 37
All above countries 869400 2632900 33 19 15 9 36 46
Excluding Canada and the United States 635700 2329400 28 18 10 10 44 49
Other foreign-born 5692700 6695400 34 58 31 11 33 32
Native-born 57083600 49551400 32 42 11 6 20 35
Native-born in Spain 6314100 na 42.262847834247 na 1.7497459437141 na 33.299857788325 na

 

Overall the tertiary-educated employed from the Americas represented 33% of all employed immigrants from the Americas in European countries and 19% in the United States. However, this reflects largely the overwhelming predominance of lesser-educated immigrants from Mexico as well as El Salvador, Guatemala and Honduras in the United States. In most other countries, the proportion of the tertiary-educated employed among the employed is higher in the United States. This is observed despite the fact that permanent labor migration, which tends to be highly skilled in the United States, constitutes only about 7% (14% if one includes family members) of all permanent migration in that country, where the international migration regime tends to be more family-oriented, compared to European countries. However, much migration from the Americas to Europe has gone to southern European countries, which have had few of the restrictions on lesser-skilled labor migration found among their northern neighbors.

Despite the more rapid recovery of the United States, it is in the European Union that the increase in tertiary-educated employed has been the largest over the 2011-2013 period compared to 2001-2009 (15% vs. 9%). However, this larger increase is entirely due to a 30% rise in employed tertiary-educated immigrants from Canada and the United States in European Union countries. If one excludes these two countries from consideration, the increases are similar in both regions (about 10%).

By contrast the increase in the tertiary-educated employed from the rest of the world in the European Union from 2007-2009 to 2011-2013 is, at 31%, almost three times that from Latin America and the Caribbean. Expatriation among the tertiary-educated from the Americas has no doubt suffered from the greater importance of Southern Europe among destination countries and the continuing weakness of labor markets in these countries. In the United States the number of highly educated migrants from the Americas has progressed more strongly than the number from the rest of the world (9% vs. 6%).

Over-qualification rates among tertiary-educated immigrants from the Americas in 2011-2013 averaged 36% in European Union countries and 46% in the United States, compared to 20% and 35%, respectively, among employed native-born tertiary-educated persons in these regions. This would suggest larger relative over-qualification in European countries than in the United States. One might expect to observe this in weaker labor markets where tertiary-educated persons may lower their expectations if they are unable to find jobs commensurate with their qualifications and accept, if only for a while, jobs which are lower paid and require lower skill levels than they possess.

In addition, many highly-educated labor migrants to Europe arrived without prior jobs and empirical results have shown that immigrants hired under these conditions do tend to have higher over-qualification rates than persons hired from abroad, who may well condition their departure on finding a job that corresponds to their educational level (OECD 2014). Immigrants who are on site and have already defrayed the costs of migrating from their countries of origin may not always be able to afford the luxury of waiting until they can find a job that matches their skill endowments.

If one removes immigrants from Canada and the United States from the calculation of over-qualification rates, the difference in rates for immigrants from the Americas compared to the native-born becomes even larger than that mentioned above. The over-qualification rates recorded then, for immigrants from Latin America and the Caribbean, are 44% for the European Union and 49% for the United States. If one now adjusts the over-qualification rate of the native-born in the European Union to take into account the fact that a high proportion of immigrants from the Americas are working in Spain, then the native-born over-qualification rate rises to about 24%, which is still significantly lower than that of immigrants from the Americas.

In short, over-qualification rates of immigrants from countries of Latin America and the Caribbean are some 15 to 20 points higher than for native-born persons. Language proficiency is not necessarily at issue here, because the over-qualification rate in Spain is even higher at 53% than for the European Union as a whole (36%). Why might this be this so? 

Migration to Southern Europe over the past decade has in general been biased towards lesser-skilled jobs. One reason for this has to do with the strong progression of educational attainment in these countries. Indeed the difference between the educational attainment of the retiring labor force cohorts and the newly entering ones in southern Europe have been exceedingly large (OECD 2014), indeed the highest by far among EU countries. On the other hand, the skill level of jobs in the economy has not progressed as strongly as the educational attainment of the youth population in these countries.

One consequence has been high levels of over-qualification among young native-born workers, on the one hand, and, on the other, a strong demand for workers to take on the lesser skilled jobs which many of the less numerous and highly educated native-born youth have been less willing to accept. Workers from Latin America were quick to take advantage of the opportunities which developed, undoubtedly with the expectation that their labor market situation would improve over time.  However, the implosion of the Spanish economy in 2008 in the wake of the bubble in the construction sector and the subsequent budget crisis have mortgaged the possibility of rapid progress for the tertiary-educated. Nowhere is this more evident than in the high unemployment rates in general and the high over-qualification rates among the tertiary-educated. As we have seen, some are now returning but many have settled for good. Only a vastly improved labor market will be able to improve their prospects. Although the signs of this are present, they are still relatively tentative, so that a significant improvement in the short-term seems unlikely. 



[1] The term « tertiary » here refers not only to university education, but also to high-level technical or professional education, which can be of lesser duration than a university degree, but is considered to be university-level education.

[2] Unpublished results.