This article explores how family background and skills affect the job prospects of Brazilian college graduates. Using national data on graduates with formal jobs four years after graduation, the study finds that high-achieving students from lower-income families are more likely to secure jobs than their wealthier peers. However, students from wealthier backgrounds and those with specific skills related to their field of study often land better jobs.

A higher education degree is associated with the most prestigious and high-paying occupations worldwide. As higher education systems expand and diversify across different countries, studies have emphasized that qualitative differences, such as the course and institution, matter in shaping graduates' transition to the market and unequal labor market outcomes. Social and economic returns vary widely across both dimensions, including first-job income and occupational status, early-career unemployment spells, and earnings. As even expanding systems can reproduce inequalities among graduates, it is crucial to debate the efficiency, quality, and meanings of higher education as an institution for labor market training, especially in contexts where there has been exponential growth in enrollments over the past decades.

Understanding the Returns to College Education in a Highly Segmented Labor Market

The Brazilian case provides an attractive context for understanding graduates’ outcomes in a market-oriented system characterized by the centrality of the for-profit sector and distance education, as well as high rates of return on a college degree. Since 2000, the Brazilian system has more than tripled the number of enrollments and implemented policies to democratize access, including affirmative action and student financing, which have brought in a highly heterogeneous student population. As in other market-oriented systems, Brazilian institutions have diversified their offerings to meet a broader range of demands, one of the most popular being to increase the chances of success in the labor market, especially in terms of employability.

Unfortunately, with a few exceptions, Brazilian research is still not very attuned to the variation in outcomes among graduates, including the new groups of students. In a recent study, we aimed to fill this gap by investigating whether general and field-related skills influence graduates’ transition into formal employment and if family background still matters. This is particularly important for the Brazilian case, given that in a labor market marked by a strong and stratified distinction between formal and informal sectors, being hired into the former may not represent the most valued occupational destinations, especially for those fields related to liberal professions (such as medicine and law).

Relative Returns to Education among Graduates in a Late-Expanding System

Research on the benefits of education has looked into not just why a college degree often leads to higher earnings and better job prospects, but also how this benefit varies across different social and institutional contexts. We already know that skills related to a field of study, especially technical ones, are crucial for finding jobs in that area, while general skills can help people access a wider range of job opportunities. In other words, there is evidence supporting the idea that students benefit from skills that increase their productivity, translating to more human capital, in a labor market that is supposedly responsive to merit-based criteria.

However, while it is important for graduates to gain skills that prepare them for the job market, it is also widely documented that different groups of students may benefit unevenly from higher education. First, there are still significant inequalities in terms of gender, race, and social class when it comes to accessing high-return courses and selective institutions. In Brazil, disadvantaged groups tend to be overrepresented in distance education programs and courses related to teaching and caregiving, and in private for-profit institutions. Second, in fields like humanities and some applied social sciences, where clear productivity indicators are lacking, the job market often penalizes disadvantaged students based on their family background, making it harder for them to access better jobs and opportunities.

In a country characterized by high inequalities and one of the highest returns to a college degree, there is an urgent need to ensure equity in access to and completion of higher education, as well as in the transition to the labor market. To support public and institutional policy, research still needs to advance in at least two directions. First, toward understanding to what extent courses and institutions are contributing to the preparation of graduates for the labor market—a question primarily related to quality. Second, toward determining whether inequalities among graduates persist or even increase as access to higher education expands—a concern related to equity. The research agenda we have been developing—of which our study is a small part—aims to contribute to this debate.

Social Origin, Skills, and Graduates’ Employment in Brazil

Our study examined the relationship between family background and the likelihood of a graduate finding formal employment four years after completing their course. The primary finding is that graduates have distinct entry points into the formal labor market, depending on their field of study and the type of higher education institution (HEI) they attend. Graduates with degrees in moderately or less occupationally specific fields, such as applied social sciences or education, have a higher chance of securing formal employment four years after completing their higher education. In contrast, graduates from the most prestigious fields of study, such as medicine and engineering, as well as those with applied bachelor degrees, face reduced formal employment prospects.

Next, we explored how these results may be related to the degree of social openness or closure within higher education careers and to the distinct dynamics of the labor market for college-educated workers in Brazil. We found evidence that the conventional understanding of the formal vs. informal dichotomy may not hold true for the upper echelons of the Brazilian workforce. For those in this cohort, the self-employed status (such as the “liberal professional”) may be preferable, justifying the use of a wide range of strategies to obtain prestigious and lucrative employment opportunities in both higher education and the workforce. In other words, the results point to a strong process of selectivity into formal employment with consequences for the levels of inequality within the graduate population.

Concluding Remarks

Our findings contribute to improving understanding regarding two major issues in the nexus between higher education and the labor market: the complementarity of factors explaining their connection, and how it varies across different fields of study. We argue that the relationship between higher education and the job market works together rather than in opposition. By looking at how these connections function across different areas of study and how they relate to social inequality, we offer a detailed analysis of how they can be improved by addressing differences in the quality of education. We also present evidence showing how certain policies can help reduce inequalities in access to higher education and lead to better economic opportunities for everyone.

Research on the economic returns to graduates provides insight not only into the structure of opportunities for social mobility or reproduction but also into the position that higher education occupies in the society’s hierarchy of values. A measure of social openness may be better gauged by the equality of conditions that enable underprivileged individuals to reach the pinnacle of the educational system and secure the most prestigious or stable jobs in the labor market. We also hope that our analysis highlights the practical importance of inclusion policies in higher education, taking into account the quality of education they provide and their impact on shaping the career and social paths of graduates.

André Vieira is assistant professor at the Fluminense Federal University, Rio de Janeiro, Brazil. E-mail: [email protected].

Maria-Ligia de Oliveira Barbosa is associate professor at the Federal University of Rio de Janeiro, Brazil. E-mail: [email protected].