August 16, 2022

Economix: The Return of the Blue-Collar Downturn

For much of 2010, the slumping economy was affecting white-collar, highly educated workers almost as much as it was affecting less educated and blue-collar workers. That’s no longer the case. In recent months, the economy has once again been easier on college graduates than it has on everyone else, much as it was during nearly all of 2008 and 2009.

The overall result is that the recession and its long aftermath have widened the portion of inequality that stems from education.

Last month, the share of four-year college graduates with jobs jumped to 74 percent, from 73.5 percent in April and 73.2 percent in January, according to Friday’s jobs report. That is the only educational group whose employment percentage is higher than it was in January.

Among people who attended college but do not have a four-year degree, 64.1 percent were employed last month, down from 64.6 percent in January. Among high-school graduates who never attended college, 54.6 percent had a job in May, unchanged from January; 38.5 percent of high-school dropouts were employed, down from 38.7 percent in January.

Obviously, the trends aren’t the only interesting part of those numbers. There are also huge differences in the employment levels for different educational groups.

What’s driving the numbers? In part, it’s the information economy’s continued demand for skilled workers whose jobs can’t easily be replaced by technology or cheaper foreign workers. The jobless rate for workers in the so-called information industries has dropped sharply over the last year. The jobless rate for workers making nondurable factory goods has not.

The salary trends have been moving in similar directions, as we have discussed here before. The gap between the pay of college graduates and everyone else is near an all-time high, according to the Bureau of Labor Statistics.

If you know anyone who is trying to decide whether to attend or finish college — and has seen lots of hand-wringing lately about whether college is still worth it in tough economic times — I would encourage you to share these numbers. The economy is tough for almost everyone, and education is not the only solution to our problems. But it is a big part of the solution, because things are a lot tougher for people with less education.

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