This document discusses structural changes in labor demand and skills mismatches in the Middle East and North Africa region. It explores how the expansion of less knowledge-intensive industries has led to weak demand for educated labor compared to a lack of skill-biased technical change. The dynamics of skilled versus unskilled labor demand, empirical measures of these concepts, and the impact on inequality are examined. Education to job mismatches and overeducation are also discussed, along with their determinants and effects on wages and job satisfaction.

1. Introduction SBTC-RBTC Inequality Overeducation References
Structural Change, Skills Demand and Job
Quality in the MENA Region
M.A. Marouani
IRD, Paris 1 Pantheon-Sorbonne and ERF
ERF-ILO Workshop
14 December 2019, Cairo

2. Introduction SBTC-RBTC Inequality Overeducation References
Introduction
• Spectacular Increase of Education Enrollment
• Objectives: modernization, social mobility
• Coupled to Youth Bulge, weak demand for skills
• Unemployment, overeducation, frustration, and rebellions
(Urdal, 2006; Nord˚as and Davenport, 2013)
• School-to-work transitions under scrutiny (Nilsson, 2019)
• Determinants of transition duration and employment status
(individual, macro)

3. Introduction SBTC-RBTC Inequality Overeducation References
Recent Research focusing on Structural Change, skills
demand and mismatch
• Education job mismatch in Ukraine:Too many people with
tertiary education or too many jobs for low-skilled? (Kupets,
2016)
• Productivity, structural change and skills dynamics, evidence
from a half-century analysis (Asik et al., 2018)
• Education Mismatch and job satisfaction in North Africa
(Lassassi and Marouani, forthcoming)
• New research on Structural Transformation and Inequality in
Tunisia (in collaboration with WIDER)

4. Introduction SBTC-RBTC Inequality Overeducation References
Dynamics of Skilled VS Unskilled labor demand
• Source of weak demand for educated labor
• Expansion of less knowledge-intensive activities VS
• Absence of skill-Biased technical change (SBTC)
• Job Polarization of employment across occupations: Routine
based technological changes (RBTC) VS other explanations
(offshoring, deindustrialization, migration, etc.)
• RBTC is more a developed country story (Kupets, 2016)
• Deindustrialization, expansion of subsistence farming and retail
trade in Ukraine

5. Introduction SBTC-RBTC Inequality Overeducation References
Empirical measures of these concepts
• Sectoral shifts: Groups of sectors according to technology and
knowledge content
• Decomposition of shifts of occupational shares in within and
between sectors components (Kupets, 2016)
∆sj,t =
n
i=1
si,t∆si,j,t +
n
i=1
si,j,t−k∆si,t (1)
• Using Employment by education data (historical analysis)
• Changes in the occupational structure of jobs (recent LFSs)
• Increase of occupational shares: often both between and
within
• RBTC: Five Dictionary of Occupational Titles (DOT) task
measures (David and Dorn, 2013) mapped into ISCO
• Possibility of aggregation into a Routine Task Intensity Index
(RTI)

6. Introduction SBTC-RBTC Inequality Overeducation References
Figure 1: Between and Within Skills Shares
Source: (Asik et al., 2018)

7. Introduction SBTC-RBTC Inequality Overeducation References
Figure 2: ISCO Occupations
Source:Kupets (2016)

8. Introduction SBTC-RBTC Inequality Overeducation References
Figure 3: Changes in employment shares of broad occupational groups -
Tunisia
Source: Lassassi and Marouani (forthcoming)

9. Introduction SBTC-RBTC Inequality Overeducation References
Figure 4: Task Intensity of Major Occupation Groups
Source: Autor and Dorn (2013)

10. Introduction SBTC-RBTC Inequality Overeducation References
Impact on inequality of occupational shifts
• Due to Structural transformation and Trade
• Other Determinants
• Temporal variation of earnings distribution among skill levels
• Role of changes in skill VS task content of jobs
• Heterogenous effects

11. Introduction SBTC-RBTC Inequality Overeducation References
Education to job Mismatch
• Education-job Mismatch higher when opportunities for
educated job-seekers decrease
• Quantitative mismatch (lower degrees requirements)
• Qualitative (different fields) (Robst, 2007)
• Skill Mismatch vs Education Mismatch (Allen and Van der
Velden, 2001)
• Genuine Mismatch or unobserved ability? (Chevalier, 2003;
Leuven and Oosterbeek, 2011)

12. Introduction SBTC-RBTC Inequality Overeducation References
Overeducation: Determinants and Impact
• Understand Labor Market Dynamics: Trade-off between an
unmatched job and unemployment
• Determinants: age, gender, origin and ability
• Impact of mismatch on wages
• How overeducation affects Work Satisfaction
• Consequences on migration

13. Introduction SBTC-RBTC Inequality Overeducation References
Methodology
• Estimation of Overeducation determinants
• Micro and Macro Determinants (including Structural Change)
• Impact of Overeducation on wages and other labor market
outcomes (Allen and Van der Velden, 2001)

14. Introduction SBTC-RBTC Inequality Overeducation References
Allen, Jim and Rolf Van der Velden, “Educational mismatches
versus skill mismatches: effects on wages, job satisfaction, and
on-the-job search,” Oxford economic papers, 2001, 53 (3),
434–452.
Asik, Gunes, Mohamed Ali Marouani, Michelle Marshalian,
Ulas Karakoc et al., “Productivity, Structural Change and
Skills Dynamics in Tunisia and Turkey,” in “Economic Research
Forum Working Papers” number 1269 2018.
Chevalier, Arnaud, “Measuring over-education,” Economica,
2003, 70 (279), 509–531.
David, H and David Dorn, “The growth of low-skill service jobs
and the polarization of the US labor market,” American
Economic Review, 2013, 103 (5), 1553–97.
Kupets, Olga, “Education-job mismatch in Ukraine: Too many
people with tertiary education or too many jobs for low-skilled?,”
Journal of Comparative Economics, 2016, 44 (1), 125–147.

15. Introduction SBTC-RBTC Inequality Overeducation References
Leuven, Edwin and Hessel Oosterbeek, “Overeducation and
mismatch in the labor market,” in “Handbook of the Economics
of Education,” Vol. 4, Elsevier, 2011, pp. 283–326.
Nilsson, Bj¨orn, “The School-to-work transition in developing
countries,” The Journal of Development Studies, 2019, 55 (5),
745–764.
Nord˚as, Ragnhild and Christian Davenport, “Fight the youth:
Youth bulges and state repression,” American Journal of
Political Science, 2013, 57 (4), 926–940.
Robst, John, “Education and job match: The relatedness of
college major and work,” Economics of Education Review, 2007,
26 (4), 397–407.
Urdal, Henrik, “A clash of generations? Youth bulges and political
violence,” International studies quarterly, 2006, 50 (3), 607–629.