Social Origin, Skills and Graduates’ Outcomes in Employment in Brazil

The dramatic expansion of higher education in developing countries associated with periods of economic crisis has posed particular challenges for the transition of young graduates into the job market. In Brazil, a highly selective tertiary system and structural difficulties in absorbing graduates into higher education occupations have raised questions about the power of a degree to level the playing field in the labour market. Unfortunately, with few exceptions, Brazilian research has been unable to deal with selectivity among degree holders both at the graduation and transition to the workplace, to better estimate the economic value of credentials. This study uses national data for the Brazilian context to investigate the college premium among graduates of various fields of study and higher education sectors. We find that the common dichotomy between formal employment and non-traditional forms of employment does not seem to apply to the upper strata of the workforce: graduates from privileged social backgrounds and with a higher level of skills tend to remain out of the formal job market soon after graduation, which seems compounded by deteriorating job market conditions for graduates. Separate analyses by the field of study show that initial differences in wages and occupational prestige are more pronounced in less occupationally specific fields and among graduates from public universities. Nevertheless, the enormous heterogeneity between careers and higher education institutions decreases in a non-trivial way once selectivity is addressed.