The Region

Degrees of Job Security - In Brief

Published December 1, 2010  |  December 2010 issue

Who suffers during recessions?

  • The fact that poorly educated, young and minority workers suffer high unemployment seems to suggest that low-wage workers bear the brunt of job loss during recessions, while higher-wage workers go relatively unscathed.
  • But high-wage workers are not spared the unemployment line during downturns; they see unemployment rate increases roughly similar to those experienced by low-wage workers. This seems paradoxical, given the low jobless rate of college graduates.
  • The key is the link between education and occupational choice. Some occupations filled by less-educated workers pay high wages, but in a recession a college degree offers better protection against joblessness than a big paycheck

Degrees of Job Security - Full Article

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Narayana Kocherlakota