< Back to previous page
Do youths graduating in a recession incur permanent losses?
Journal Contribution - Journal Article
In flexible labor markets, low-educated entrants are harmed by economic downturns, but the penalties are short-lived. High-educated youth are less adversely affected, but the penalties persist longer. It takes about ten years for young cohorts that enter the labor market during a downturn to catch up to cohorts that did not. In rigid labor markets, however, while low-educated entrants are better shielded in the short term, both low- and high-educated workers never make up theirearnings losses. Macroeconomic stabilization policies should be complemented by policies that aim at combining more job flexibility with job security.
Journal: IZA WORLD OF LABOR
Pages: 1 - 11