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Starting out in low-skill jobs

By Tom Karmel, Tham Lu, Damian Oliver

The purpose of this research is to examine whether, for those who have left full-time education, a low-skill job provides them with a good start to their working lives. It was found that starting out in a low-skill job gives lower payoffs than starting out in a high-skill job. Five years after leaving  full-time education, the wage penalty (after conditioning on education and other characteristics) still exists but this scarring effect diminishes over time. However, any job is better than having no job.