Salary (in)equalities Among Hungarian Higher Education fresh graduates by the institutions

Abstract

THE AIMS OF THE PAPER

The study focuses on the factors determining the quality of a Higher Education institution (HEI) as part of its competitiveness or ability to alter their position in rankings. It is not an easy task to determine this issue, since it is used to focus on objective factors’ examination, while subjective, hardly quantifiable factors have high influence, too. Input is in focus in Hungary, whilst output is important at least the same. Consequently, we intend to explore whether exist a difference among the Hungarian traditional universities graduates’ wages and comparing them to other HEI types, considering the socio-demographic background factors, the education-related issues, and labor-market elements, too.

METHODOLOGY

By the use of the Fresh Graduates 2011-2014 databases, consisting of 90,740 respondents representing 488,895 basic population graduates. We had to apply several restricting elements to create more homogenous groups to reduce the influencing factors’ effects as much possible. We have run two linear an OLS analysis on samples of more than 10 and 20 thousands of graduates.

MOST IMPORTANT RESULTS

First, the traditional Hungarian universities were observed and with the involvement of 40 variables (socio-demographic, academic, labor market related), we stated that there is no wage difference between graduates in model M3 for traditional Non-Budapest seated HEI compared to the ELTE. This is true for University of Pécs, University of Debrecen, and University of Szeged, too. Due to the chosen methodology, this statement is valid in the context of each of them regardingthe others. In the next step extending for the institutions of widely profiled, and for all of the respondents, it is evidenced, that there is a negative wage difference in general, which can be traced back to the student composition.  We concluded that the traditional Hungarian universities have wage disadvantage in only some academic areas due to the fact of graduation at the given institution, which also states that the graduates can reach an equal level of salary independently from the institutions. In addition, it also means, that the labor market may not able or not willing to detect and evaluate the alleged quality differences based on decades of input-oriented traditions of rankings. Looking at this in the light of the interpretation of quality as perceived by stakeholders, it can be stated that the aspirations to emphasize the HEI characteristics and peculiarities are insufficient.

RECOMMENDATIONS

Overall, many factors can affect the labor market wages, besides the variables involved in the analysis, we concluded that based on feedback coming from the labor market, the HEI is not the primary determining one. These are more likely related to the local labor-market peculiarities and the economic development. Also, we admit that this result does not exclude that the services and opportunities offered by the HEI may affect the intentions, the plans, and chances of labor market employment of the fresh graduates. This also means that the higher education institutions are not supposed to focus on the disadvantaging elements, rather on the development of student-oriented services to help them to become successful in the labor market, and to create and strengthen a clearer concept of HEI’s in the mind of the employers.