Graduating in Austerity: Do Welfare Cuts Affect the Career Path of University Students?

紧缩毕业：福利削减会影响大学生的职业道路吗？

• 批准号: ES/Z502595/1
• 负责人: Taheya Tarannum
• 金额: $ 18.41万
• 依托单位: University of Oxford
• 依托单位国家: 英国
• 项目类别: Fellowship
• 财政年份: 2024
• 资助国家: 英国
• 起止时间: 2024 至 无数据
• 项目状态: 未结题
• 来源: https://gtr.ukri.org/projects?ref=ES%2FZ502595%2F1
• 关键词: Graduating; Austerity; Do; Welfare; Cuts

Austerity policies often follow a period of fiscal stimulus. For example, the UK government's borrowing is estimated to have reached approximately 17% of the GDP during the COVID-19 pandemic, marking the highest rate of borrowing since World War II. In the aftermath of the pandemic, the government has implemented or considered various measures to curb public spending and transfers. While austerity measures are typically temporary in nature, they can unintentionally yield lasting effects on the labour market prospects of university graduates. This is because the conditions in the labour market at the time of entry can exert a persistent influence over the careers of university students (Kahn, 2010; Oreopoulos et al., 2012; Altonji et al., 2016; Schwandt and VonWachter, 2019).To understand how welfare cut affects the career path of graduates, we propose to study the introduction of the Welfare Reform Act 2012 by the British government. The extent of the cut varied substantially with the worst-hit local authorities losing around four times as much as the least-affected local authorities (Beatty and Fothergill, 2013). The reform exhibited a strong negative fiscal multiplier with a sizeable reduction in production (Fetzer, 2019) and employment (Adelino and Goldman, 2022), suggesting that job seekers in severely affected areas faced challenging labour market conditions. Moreover, a weaker safety net could increase the first-time job seekers' vulnerability to cope with the shocks since early in their careers many of them do not have enough resources to smooth consumption.To examine whether welfare cuts had detrimental effects on the transition of young adults from university to the workforce, we first study the effects on their likelihood of getting employed and initial earnings. Second, we examine whether these adverse effects on labour market entry had a persistent influence on their careers in terms of earning profiles and job quality. Third, to understand the underlying mechanism and heterogeneity, we explore the differential labour market outcomes for graduates majoring in different disciplines of study and by gender, ethnicity, parental education, and socioeconomic background. This exercise will provide us with additional insights into which segments of graduates are more susceptible to the impact of welfare cuts.An empirical challenge to studying the effect of austerity on graduates is that survey data can only give fragmented information making it impossible to get a complete picture of how university graduates from different educational backgrounds transition to the labour market. The linked administrative data available through the Longitudinal Education Outcomes (LEO) programme fills up this gap. Also, the variation in the size of expenditure cut across localities allows us to compare university graduates in localities that experienced deeper welfare cuts with those from less-affected areas controlling for any pre-existing differences across localities and long-term labour market trends.Overall, the findings of this study will provide a better understanding of how graduates cope with labour market shocks induced by austerity policies. Between 2012 and 2015, 1.5 million students obtained their first degree (Source: HESA). Our results will shed light on whether a weaker labour market combined with a weaker safety net had a lasting impact on their careers. This is important to understand as it could affect the well-being of an entire cohort and have implications for within- and across-cohort inequality. The findings could also be useful in designing austerity policies shielding the most vulnerable.

紧缩政策通常遵循一段时间的财政刺激。例如，英国政府的借款估计在19日大流行期间已达到了大约17％的GDP，这标志着自第二次世界大战以来的借贷率最高。大流行之后，政府已实施或考虑了遏制公共支出和转移的各种措施。尽管紧缩措施通常是暂时的，但它们可以无意间对大学毕业生的劳动力市场前景产生持久影响。这是因为进入时劳动力市场的条件可以对大学生的职业产生持久影响（Kahn，2010; Oreopoulos等，2012; Altonji等，2016; Schwandt and Vonwachter，2019年）为了了解福利削减如何影响毕业生的职业道路，我们建议研究英国政府2012年《福利改革法》的引入。削减的程度大大差异，受到最严重的地方当局的损失是受影响最少的地方当局的四倍（Beatty and Fothergill，2013年）。这项改革表现出强大的负财政乘数，生产的大量降低（Fetzer，2019年）和就业（Adelino and Goldman，2022年），这表明，受影响严重的地区的求职者面临着挑战性的劳动力市场状况。此外，较弱的安全网可能会增加首次寻求求职者应对冲击的脆弱性，因为他们职业生涯的早期，许多人没有足够的资源来平稳消费。检查福利削减是否对过渡的过渡有害从大学到劳动力的年轻人，我们首先研究了他们受雇的可能性和最初收入的影响。其次，我们检查了这些对劳动力市场进入的不利影响是否在赚钱和工作质量方面对他们的职业产生了持久的影响。第三，为了了解潜在的机制和异质性，我们探讨了在不同学科的研究和性别，种族，父母教育和社会经济背景中主修的毕业生的差异劳动力市场成果。这项练习将为我们提供其他见解，毕业生的细分市场更容易受到福利削减的影响。研究紧缩对毕业生对毕业生的影响的经验挑战是，调查数据只能提供分散的信息，使得无法获得完整的信息大学毕业生如何从不同教育背景过渡到劳动力市场的情况。通过纵向教育成果（LEO）计划获得的链接行政数据填补了这一空白。此外，跨地区削减支出的规模的差异使我们能够比较地区毕业生的地区毕业生，这些地区的福利削减与受影响较小的地区的福利削减的地区相比，该地区的毕业生控制着各个地方和长期劳动力市场趋势的任何现有差异。 ，这项研究的结果将更好地了解毕业生如何应对紧缩政策引起的劳动力市场冲击。在2012年至2015年之间，有150万学生获得了第一学位（来源：HESA）。我们的结果将阐明较弱的劳动力市场是否与较弱的安全网对他们的职业产生了持久的影响。这很重要，要理解，因为它可能会影响整个队列的福祉，并且对内部和各种不平等的不平等有影响。这些发现也可能在设计紧缩政策掩盖最脆弱的情况下很有用。