The Impact of Surplus Schooling on Worker Productivity

Human capital theory suggests that education enhances worker productivity and is reflected in higher individual earnings. We use data from the 1969 Survey of Working Conditions and the 1973 and 1977 Quality of Employment Surveys, and a model derived from the industrial psychology literature, to test the proposition that workers' education in excess of what their jobs require can have adverse effects on job satisfaction and other correlates of worker productivity. Our results support earlier studies that have found surplus schooling has a negative effect on job satisfaction. Our findings also indicate that the negative impact of surplus schooling on job satisfaction and turnover is more significant for workers with a higher level of surplus education. Finally, the negative effects of surplus schooling appear to change over time.