The employability of young graduates in Europe

The Education Council has adopted in May 2012 a new benchmark on the employability of graduates from education and training that aims at measuring the contribution of education and training to the transition from education to employment. This new benchmark is defined as the share of young people employed among the 20-34 years old, who graduated 1, 2 or 3 years before, and are not currently in education or training. It is computed using the annual Labour Force Survey (LFS) microdata. This report aims at analyzing the determinants of the employability of the individuals targeted by the benchmark. It starts with a short presentation of the benchmark indicator. It then estimates the probability of being employed for the 20-34 years old cohort that graduated one to three years before and is not currently enrolled in any further education or training activity, controlling for individual characteristics and institutional factors. In addition to the annual LFS data, we also make use of the LFS ad-hoc module of 2009 to identify more specifically, at country level, the role played by the orientation of the degree and the acquisition of a professional experience during the time of studies. Among those who are employed, we then analyze the nature of that employment by estimating the probability of having a permanent vs. temporary contract and the probability of working full-time vs. part-time. Regarding the probability of being employed, we find that the contribution of education attainment is significant and constant, even after controlling for labour market contextual variables. Whereas education attainment is an important determinant for working full-time, it does not play a role in explaining the probability of having a permanent contract. We find that, overall, having a vocational oriented degree and/or working during studies does not affect significantly the probability of having a job. On the other hand, for a few countries, these two factors are important and our analysis shows that among the two, working during studies proves to be a more significant factor than the sole orientation of the degree.JRC.G.3-Econometrics and applied statistic