Volume 44, Number 174,
July-September 2013
Salary Gaps in Uruguay: Gender, Segregation
and Unequal Labor Qualifications
Alma Espino
Gender, Segregation and Mismatch ( ...continuation )

As mentioned, the distribution of occupations by gender in the Uruguayan labor market shows a strong structural association between gender and types of occupation. In order to link the results of this study with labor segregation by gender and economic discrimination, we include the variable of percentage of women by type of occupation, sector of activity and size of establishment. By adding these variables, the coefficient linked to gender is reduced while variables linked to mismatch are maintained. It is of note that the occupational segregation variable and the sectors of activity variable are negative, which is evidence of their contribution to the gap.

The results of equations (4’) and (5’) explain salary differences among workers with similar characteristics and the same years of education given their positions in the areas of over or under-qualified employees. When controlling for education, over-qualified workers earn on average 14.1% less than appropriately qualified employees, while under-qualified persons earn 13.2% above average. The interpretation of this situation may be that over-qualified workers do not have expected levels of productivity, or that education does not guarantee productivity. Alternatively, low salary returns for over-qualified people would be reflected in positions with low salaries, that is, concentrated in low salary occupations, as is the case for women. When adding in the segregation variables, the under-qualification coefficient falls slightly. The results match those presented in literature on the subject (for example, Rubb, 2003): returns on required education are higher than returns on observed education. Years of over-education are rewarded, but less than years of required education. Employees with low educational levels earn less than workers in similar jobs with the required level of education. However, the former earn more than employees with the same level of education, but in jobs where the required level is lower. This would suggest that years of formal education do not have the same educational return. This would depend both on the education offered by as well as required by the job, as suggested by assignment theory (Hartog and Oosterbeek, 1988: 188). The given oru model provides greater information on the impact of human capital variables on remuneration, and therefore would be better than equations that merely include effectively acquired education (Hartog, 2000).

In order to estimate the impact of mismatch on salary gaps between the two genders, the data was further broken down. Table 7 shows absolute and relative salary contributions of the variables associated with skill mismatch. Being in the over and under-education segments contributes to the salary gap, although at a magnitude slightly lower than for the segregation variables.

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PROBLEMAS DEL DESARROLLO. REVISTA LATINOAMERICANA DE ECONOMÍA, Volume 49, Number 195 October-December 2018 is a quarterly publication by the Universidad Nacional Autónoma de México, Ciudad Universitaria, Coyoacán, CP 04510, México, D.F. by Instituto de Investigaciones Económicas, Circuito Mario de la Cueva, Ciudad Universitaria, Coyoacán,
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