Research Spotlight: Dr Dita Eckardt

Dr Dita Eckardt joined the Department of Economics, University of Warwick in August 2021. Here she discusses her work on training and skills in the labour market and what attracted her to join the Department.

What research projects are you currently involved with?

My research focuses on policy-relevant topics in labour economics, and I am particularly interested in questions around workers’ training and skills. I also do methodology work in applied econometrics, with the goal of applying new methods to empirical questions in labour and applied microeconomics more broadly.

The aim of my current work in labour economics is to better understand what kind of skills workers require to work in different occupations, how they acquire these skills, and how flexible they are in their choice of occupation after training in a particular field.

To make progress on these questions, I have been working with data from the German apprenticeship system. This is a context where young workers get trained in specific occupations, so it is straightforward to see whether a worker has ended up in the occupation they got trained in or not.

The first question I wanted to address is whether moving to an occupation different from one’s training means that workers earn less, potentially because they lack some of the skills relative to their co-workers with the ‘right’ training. Interestingly, it turns out that there is such a penalty, and that the penalty grows the more different the tasks in the occupation are to those in the original training. At the same time, the workers who switch out of their field are particularly good at what they move into. Intuitively, they compensate for their lack of training with more occupation-specific ability.

Why did you choose this research field?

My initial motivation to choose this research field was very much a genuine interest in finding answers to the question of what happens if workers are trained in one field but work in another. I became interested in this topic while studying as an undergraduate in the UK. I noticed how many of my friends were studying specific subjects with the intention of later entering occupations in other fields. This got me thinking about the specificity of skills that students learn and what this implies for flexibility in the labour market.

The fact that there are important implications for real-life policy was another key motivation.

Once I started digging deeper, I also realised that there were a range of interesting econometric challenges associated with this research field. In particular, workers are not randomly assigned to a training or an occupation, and they make their training and occupation choice based on characteristics that are unobservable to the researcher. It is important to find ways to address this kind of selection in the econometric analysis. Given that there are many trainings and occupations to choose from, this is a very challenging exercise.

I believe it is this combination of important big-picture questions and technical challenge that I have enjoyed while working in the field.

What impact do you hope your research will have on society?

There are several policy implications from the findings in my work. In particular, my findings have shown that many workers cannot fully put their skills to use in their current occupation, and that not having the right training can lead to lower productivity and wages.

A concrete policy implication from this is that retraining programmes may be worthwhile for some of these workers. In fact, it turns out that many workers choose an occupation different from their training relatively early on in their work lives. These individuals have many years in the labour market ahead of them and as a result, retraining programmes can pay off, even though there are sizeable short-run costs to retraining.

Another policy angle is around the reasons behind choosing a type of training that is no longer optimal later on. One important factor is unexpected changes in the labour market, which may lead to better opportunities in other occupations. Another factor is a lack of information about one’s own skills when choosing training. A key question relating to this is to what extent government programmes (such as internship programmes and workshops) could support young workers in making better choices, leading to less switching at a later stage. I am hoping that my research will help inform this debate.

What are you planning to work on next?

My next steps in this line of research are to take the findings and explain other phenomena in the labour market. For instance, young workers graduating into worse macroeconomic conditions have been shown to suffer from persistent wage losses. I am interested in analysing to what extent the inability to match their skills to the right occupations can explain these findings.

Besides follow-up projects within the context of the German apprenticeship market, I am also planning to start working on related questions in the UK in the near future.

Why did you join the Economics Department at Warwick?

The Economics Department at Warwick offers a great working environment. The quality of research in my broad field of applied microeconomics is excellent, and this was definitely an important factor for my choice. Warwick Economics is also a relatively big department, so there are colleagues working in pretty much all areas of economics. This makes it a very vibrant research community. We get many chances to present and discuss our work with colleagues which is particularly great as a junior researcher, as it is these interactions that really make a project develop and improve.

The Department of Economics is also an extremely welcoming workplace. As newcomers this academic year, we have been included in Departmental activities pretty much from day one and we also regularly meet up for social events on and off campus.

Dita Eckardt is an Assistant Professor in the Department of Economics.

See Dr Eckardt's staff profile