School-to-Work Transition in the Youth Labor Market in Central and Eastern Europe: A Cluster Analysis Approach

Abstract

Background: This study analyzes education, training, and the youth labor market in central and eastern Europe. Objectives: This study aims to evaluate similarities and differences in youth labor markets among eleven central and eastern European countries from 2008 to 2021. It specifically examines three aspects: wage ratios, early departure from education or training, and the share of the population not in employment, education, or training. Methods/Approach: This study applies hierarchical clustering and multidimensional scaling to panel data. The complete-link method organizes countries into clusters. This study combines three-dimensional Cartesian projections and two-dimensional projections based on multidimensional scaling with dendrograms and heatmaps, to graphically illustrate the "school-to-work" transition across this region. Results: Clustering highlights the Visegrád countries, the Baltics, and the Balkans as zones with internally homogeneous yet externally heterogeneous challenges for the youth generation. As the outliers in each of these regions, Poland, Estonia, and Bulgaria support clustering solutions that deviate from conventional understandings of central and eastern Europe. Conclusions: Historical and geographical ties continue to define this region’s youth labor markets across political and economic dimensions. Clustering analysis identifies triumphs and struggles in policymaking in some of the poorest and most politically challenging member-states of the European Union.