Essays on Labor Market Size and Job Match Quality

This dissertation is comprised of two essays that delve into the construction of a major-related labor market and its correlation with college graduates’ job match quality. Investigating the job match quality of college graduates for different majors in large cities is crucial, as it provides evidence on which majors tend to yield better job matches. This contributes to the study of the return on major while also shedding light on how city size impacts individuals’ ability to find jobs that align with their educational level and major, thereby enriching the study of the benefits of agglomeration. The first chapter examines whether college graduates work in occupations that match their educational level and the skills acquired through their majors, subsequently assessing the correlation between labor market size and job match outcomes. Although previous theoretical literature posits that larger cities lead to better job matching outcomes, empirical evidence regarding this relationship remains inconclusive. This paper proposes a novel measure of labor market size specific to each college major and investigates its impact on job match quality. The results suggest that the size of a major-specific labor market is a predictor of improved job match quality. However, the size of the overall labor market demonstrates an inconsistent effect on job match quality. Furthermore, the findings reveal that the impact of major-specific labor market size is more pronounced for male and younger workers. In chapter two, the focus shifts to the correlation between major-specific labor mar- kets and job match quality for married power couples. Power couples, defined as highly educated, dual-career spouses, have been documented to reside predominantly in large cities. However, literature providing direct evidence supporting the notion that college-educated women experience greater career success by living in larger urban areas remains scarce. Building upon the ideas and results from the first chapter, this section examines whether power couples’ job match quality benefits from residing in large urban areas, as defined by various criteria. The findings suggest that both husbands and wives in power couples are more likely to work in occupations that match their educational level and acquired abilities in larger major-related labor markets. Interestingly, the correlation between population and job match outcomes for power couples proves inconsistent across different models, which is in line with the individual-level results presented in the first chapter