The Wage Effects of Education-Occupation Match of Sub-Degree Graduates in Hong Kong

My dissertation uses Human Capital theory as the basic theoretical framework to analyze the linkage between education and occupation. In particular, I explore the effects of different degrees of education-occupation match on the wages of sub-degree graduates in Hong Kong using the 2011 Hong Kong Population Census data. My sample include 1974 sub-degree graduates aged 20-30. In the research, 26 subjects, based on Census coding, are categorized into 5 specialized courses and 1 general course ( Table 8). "Direct-match", "wider-match" or "mismatch" based on the specialized courses and the occupations respectively. The findings of this study are summarized as follows:;1. The overall rate of return to education in Hong Kong is 12.3%, and the rate of return to sub-degree level is (14.5%). Therefore, there are economic incentives for individuals to pursue sub-degree education and for society to maintain the sub-degree programmes.;2. The unemployment rate of the young sub-degree graduates (6.2%) is far below that of the young Form 7 graduates (9.4%). On the other hand, although 51% of the specialized sub-degree course graduates are able to acquire jobs that fall into either "direct-match" or "wider-match", there is still a large ratio of the graduates who found jobs that are "mismatched" to their education training, Besides, the mean earning of the overall sub-degree graduates is only ;3. Among the specialized sub-degree course graduates, those who fell into "direct match" have a statistically significant advantage in wages (17%) than those who fell into "mismatch". Those who fell into "wider match" have 6.6% higher wage compared to the ones who fell into "mismatch". This proves that the extent of education-occupation match ,the higher the wage levels.;4. Furthermore, It is found that sub-degree graduates in engineering courses are more likely to fall into "mismatch" than sub-degree graduates in commercial courses, though they have higher wages regardless of the levels of "match" compared with sub-degree graduates of other courses.;5. Sub-degree graduates in specialized course who fell into "direct match" are found to earn 7.4% more than sub-degree graduates in general course that fell into the same category. However, there is no statistically significant difference in wages between sub-degree graduates in general course and sub-degree graduates in specialized course who fell into the category of "wide match" working in equivalent job. In short, the sub-degree graduates in general course have similar productivity (measured by wage levels) with sub-degree graduates in specialized course. It implies that investing in sub-degree programmes that focused more on generic skills can help to boost the overall productivity in Hong Kong. (Abstract shortened by UMI.).