PMMA-19985 Analysis of youth underemployment in Macedonia, Montenegro and Serbia

Abstract

When a worker underuses his/her skills, training and experience, he/she is said to be underemployed. Youth are particularly prone to underemployment, especially on high-unemployment labor markets. The labor markets of Macedonia, Montenegro and Serbia are of this kind. Therein, between ½ and 2/3 of youth possess at least two out of five underemployment conditions: work less than 35 hours and want to work more, temporary contract, job insecurity, salary below the minimum, over-qualification. Still, underemployment is not a topic in the Youth Employment Plans of the three countries, because of lack of evidence and of the crowding-out focus on youth unemployment. The objective of the proposal is to describe underemployment and investigate its effect on personal well-being in the three countries. Special reference to gender will be made. By so doing, it opts to bring the issue to policymakers’ agenda and formulate ideas for policies tackling underemployment. Methodologically, we first set underemployment a function of personal and local-labor-market characteristics. We rely on Heckman models – binary- and ordered-outcome ones – to overcome the potential selectivity bias into underemployment. For the ordered case, we use a CMP estimator. We then regress personal welfare on underemployment and worker’s characteristics. As welfare is latent variable, we rely on MIMIC model. To overcome potential endogeneity of underemployment, we specify third regression in the model whereby observables and exogenous instrument determine underemployment. The average local/municipal wage at the time when the person became (under)employed is used as instrument. The School to Work Transition Surveys (2014-2015) are used.

Members

Project leader: Blagica Petreski

Project researchers: Despina Tumanoska | Tereza Kocovska | Ivan Vchkov

Scientific mentors: Jorge Davalos

Journal publication

Authors	Co-Authors	Title of paper	Title of Economic Review	Bibliographic references
Blagica Petreski, Jorge Dávalos, Despina Tumanoska		<p>Youth Underemployment in the Western Balkans: A Multidimensional Approach</p>	Eastern European Economics	Volume 59, 2021, Issue 1, pp 25-50 (Online)

Working Papers

	Title	Modified	Size	Comments	Recommendations
	Analysis of Youth Underemployment in Macedonia, Montenegro, and Serbia	2019-02-20	0.99MB	0	0

Policy Briefs

	Title	Modified	Size	Comments	Recommendations
	Highly educated but low paid: Youth in Macedonia, Montenegro and Serbia	2019-04-24	548.63kB	0	0

Final report

	Title	Modified	Size	Comments	Recommendations
	Analysis of youth underemployment in Macedonia, Montenegro and Serbia	2018-10-03	495.64kB	0	0

Proposal

	Title	Modified	Size	Comments	Recommendations
		2017-09-21	465.97kB	0	0