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