Bad Start, Bad Match? The Early Career Effects of Graduating in a Recession for Vocational and Academic Graduates

Abstract

I estimate the effect of graduating in a recession on the early careers of higher-educated vocational and academic graduates in the Netherlands over 1996–2012, using variation in field-specific employment conditions at graduation. Academic graduates suffer about a 10% wage loss per percentage-point decline in field-specific employment, fading out roughly six years after graduation; vocational graduates face a smaller initial loss that is more persistent.

Main findings

• Academic graduates lose about 10% in wages per percentage-point decline in field-specific employment at graduation, fading after about six years.
• Vocational graduates face a smaller initial loss (~6%) that persists, remaining around 1% eight years on.

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