Overqualification Varies Significantly Depending on Field of Study and Academic Achievement

Although a tertiary degree is often considered a crucial step towards a successful professional career, many highly qualified young professionals in Germany have been unable to find employment which is appropriate to their level of education. A study by the Centre for European Economic Research (ZEW) in Mannheim shows that even after ten years of labour market experience, one out of seven university graduates in Germany is overqualified, i.e. they hold a position which is below their qualification level. The risk of overqualification varies, however, depending on the field of study, academic achievement as well as labour market success.

The study drew its data from a survey among university graduates who completed their study programme in 1997 and 2001 (Graduate Panel by the German Centre for Higher Education Research and Science Studies). The participants were each surveyed one year, five years and ten years after their graduation. The survey featured questions on various aspects of their professional careers. At each point in time, the graduates were asked to provide information regarding the qualification level required for the jobs they were holding at that moment. The study classified those university graduates as formally overqualified that are holding jobs for which they do not need a tertiary degree.

The study finds that at the beginning of their professional careers, i.e. one year after graduation, one out of six university graduates holds a job which is below their qualification level. Even with increasing work experience, the number of overqualified workers only decreases moderately. Ten years after graduation, one in seven graduates is still formally overqualified. Depending on the respective field of study, the risk of overqualification varies significantly.

Risk of overqualification higher among STEM and social science graduates

The lowest rates of overqualification were observed in the fields of medicine, law and school teaching. In these subjects, only four per cent of the graduates were overqualified for their jobs. Among graduates of the so-called STEM subjects – science, technology, engineering and mathematics –, however, the share of overqualified individuals amounts to 12 per cent. Since skills acquired in STEM subjects are seen as important drivers of innovation in the context of progressing digitization, an increase in the number of STEM graduates is often demanded.

The findings of the study indicate that there is still progress to be made in terms of filling existing vacancies in those fields by improving the allocation of university graduates. "Nevertheless, the figures also show that there is a high demand for STEM graduates, which has results in a relatively low rate of overqualification. The risk of overqualification is considerably higher among university graduates in the fields of business administration and economics as well as social and cultural studies, with 26 and 22 per cent respectively," explains Daniel Erdsiek, a researcher in ZEW's Department "Information and Communication Technologies" and author of the study.

Graduates with successful career entries are less likely to be overqualified

Individual academic achievement is another important factor determining overqualification. Among those students in the top 25 per cent of their class, around one in ten is unable to find appropriate employment. Individuals in the lowest quartile are, however, more than twice as likely to be overqualified, with one out of four graduates holding jobs below their qualification level. "Even after ten years of work experience, the pattern across the quartiles remains unchanged," says Daniel Erdsiek.

A successful start into the professional career is also negatively associated with future overqualification. According to the study, merely nine per cent of those graduates who were able to find appropriate entry positions are overqualified for their jobs ten years after graduating. For university graduates who accept a job below their qualification level in the beginning of their career, the risk of being overqualified after ten years of work experience is 42 per cent. "In many cases, these university graduates might be involuntarily overqualified because they have had difficulties in finding appropriate jobs, even after several years of work experience. Some of those graduates might, however, have deliberately chosen jobs with lower requirements out of individual preferences," says Daniel Erdsiek.

For further information please contact:

Dr. Daniel Erdsiek, Phone + 49 (0)621/1235-356, E-mail erdsiek@zew.de