Education occupation mismatches and the great recession

In April 2008 the U.S. unemployment rate was 5.0 percent and near the natural rate. By April 2009 it reached 9.0 percent, peaking at 10.0 percent later that year.  The rapid decline in the unemployment rate provides a natural experiment on the impact of recessions on the labor force status of overeducated workers.  This paper fills a void in the literature by providing insights on the impact of the Great Recession on the labor force status of workers who are overeducated just prior to the recession.  Using simple incidence data or simple measures of employment status suggests that overeducated individuals are less likely to see their hours reduced to part time relative to their undereducated or just educated counterpart.  That said; controlling for other variables with the use of multinomial logit models sheds a different light. Those overeducated are shown to be one to four percentage points more likely to see a change in labor force status relative to those undereducated.  Individuals overeducated prior to the Great Recession are one to four percentage points more likely to become unemployed or have their hours significantly reduced one year later relative to their undereducated counterparts, ceteris paribus.   Additionally, roughly 12 percent of those overeducated prior to the recession exit full time employment the following year, up sharply from the 7.7 percent exit rate during the 1991-92 recession as reported in another study. Despite this, roughly one in five overeducated workers secure employment in occupations where they are not overeducated a year later, a figure comparable to that found in 1991-92.