The recession has taken what was more or less an nicely operational system, and created an absolute mess, a jobs situation without enough jobs and with years to go before we get to anything you could call ‘normal’. What’s more, the ‘normal’ we get to is not going to be like the normal we had before.
And yes I did see today’s jobs report, and it was ‘good’. Jobs only down by 36,000 (bringing total job loss since the recession began in December 2007 t0 8.4 million) and an unemployment rate that remained at 9.7 percent. Progress is being made, however slowly.
But is everyone sharing in the progress? Hmmm.
Let’s look at one of the most worrisome parts of the U.S. labor market: the way that the unemployment rate has changed for the different segments of the U.S. labor force depending on their education.
According to the Bureau of Labor Statistics (BLS), the unemployment rate for all workers 25 years and over was 8.3 percent (yes youth unemployment is an important issue, but that’s for another post). For those workers who do not have a high school diploma, the rate was 15.6 percent; for graduates it was 10.5 percent; for those with some college, 8 percent and for those with a bachelor’s degree or more, a teensy 5.0 percent.
That’s quite a spread. Education apparently pays, or put another way, not getting much education is painful.
Now, it is true that the everyone has felt the sting of the recession. No matter their level of education, Americans in all categories have seen their job prospects plummet since the economy tanked.
To take an example, let’s go all the way back to the beginnng of 2006 (well before the recession began in December 2007, and at a time when subprime mortgages were still a rarity). At that point, those Americans who had less than a high school education had an unemployment rate of 6.9 percent, while those who had an undergraduate degree or more had a rate of 2.1 percent.
You could even argue that at that point it things were even more unequal, since the unemployment rate for the least educated group was more than three times what it was for the most educated.
Then the recession hit, and everyone shared the initial pain. U.S. job losses have spanned a wide spectrum, and both Wall Street and Main Street have shed workers.
But here’s the catch: workers with a bunch of education have apparently been able to lose one job and land another. For those with much formal schooling, the labor market is still a dark place – even as the ‘recovery’ takes hold.
Now, that is not to say that all is rosy for the graduate group, or for any group. Yup, there are those with some expensive credentials who are serving up the lattes at your favorite coffee house, and maybe not having a good time. Thing is, they’re displacing those (maybe more willing) coffee servers with lesser education.
Will things get better soon? Hard to say, but I’m not crazy with what i’m seeing in terms of the long term unemployed.
Since December 2009, the number of people who have been out of work for 27 weeks or longer has topped 6.1 million – about a doubling over the last year. Even without formal statistics breaking the group down by level of education, its not hard to figure out which group is having the hardest time.
This is a story that’s not done unfolding yet. There’s a have-and-have-not problem that is not getting better, and in fact is likely to get worse over the next decade.
In the absence of an economic boom (which has happened before, fingers crossed) or some really great policy moves, it’s not going to be a happy tale.