Understanding Local Level Skill Mismatches

This project investigates skill mismatches in various UK regions, where the demand for specific skills doesn’t align with the available supply. It uses job platform, administrative, and survey data to identify and understand these mismatches, with a focus on well-performing and left-behind areas, and considering factors like migration and health status. It also explores the role of Further Education (FE) colleges as skill suppliers, and assesses their limitations due to student educational backgrounds, aiming to quantify the impact of skill mismatches on productivity.

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Summary & aims

This project examines skill mismatch defined as the demand by firms for specific types of skilled labour does not match the supply, for regions of the UK. This will combine data from job platforms with administrative and survey data to identify where skill mismatches arise. It will then estimate the drivers of skill mismatches, focusing on well-performing versus left-behind areas, taking into account migration between regions for young people and health status for older cohorts. The project will pay particular attention to the FE sector as a supplier of skilled labour, and consider how much these colleges might be constrained by the educational backgrounds of their students. Finally, the project will attempt to estimate how much productivity is affected by skill mismatches.


We will use quantitative analysis to investigate these issues. In the literature on demand and supply of skills, there are three main approaches. One uses data on wage premiums for particular types of skills, usually graduates versus non-graduates, to back out demand and supply effects (e.g. Stansbury et al.,2023, O’Mahony et al., 2023). An alternative approach is to measure skill mismatches directly, by linking them them with occupations, fields of study, or other aggregate data. For example, it is common to classify occupations by their educational requirements, based on the average (mean or modal) education level in that occupation, and then calculate the proportion of employees whose education levels are above or below these averages. When focusing on graduates, skill mismatches have also been evaluated using information on average wages by degree subject and industry of main employment (Liu et al. 2016). Information on industrial sector mismatch can be particularly useful in conjunction with information on the industry concentration in different regions to improve our understanding of regional opportunities for graduates and regional inequalities (Robinson et al. 2023). The different conceptions of mismatch can then be related to factors that affect demand and supply. In this study, we will focus on the different ways we can quantify mismatches by examining demand and supply separately.

Augustin de Coulon is also an Co-Investigator on this project

Principal Investigator


Larissa Marioni
Principal Economist


Janine Boshoff