Edward Conard

Top Ten New York Times Bestselling Author

  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
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  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “Unintended Consequences should be read by anyone who takes for granted the superiority of progressive taxation and has not thought carefully about the trade-offs involved.” - The New Republic
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  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
Upside of Inequality Oxford Unintended Consequences

AI Summary. The Federal Reserve Bank of New York finds the employment-rate gap between college-educated and non-college workers is larger than gaps by race/ethnicity or sex, and wider than before the pandemic. Most of that gap reflects differences in labor force participation rather than unemployment rates.

Rajashri Chakrabarti, Thu Pham, Beckett Pierce, and Maxim Pinkovskiy Federal Reserve Bank of New York
Date Posted:
Is Database:
Database

The gap in employment rates between workers 25–54 who have completed college and workers who have not is 13pp, up from 12.2pp pre-pandemic.

Is the employment gap by education larger than by race or sex?

Core argument: Using the New York Fed's Economic Heterogeneity Indicators, the authors find the employment rate gap between workers who have completed college and those who have not exceeds the gaps between racial/ethnic groups or between men and women.

We document profound differences in labor market outcomes by educational attainment. Drawing on the [New York Fed] Economic Heterogeneity Indicators, we find that the gap in employment rates between workers who have completed college and workers who have not is larger than the employment gaps between workers of different races/ethnicities or between men and women—and is wider than the pre-pandemic gap. Moreover, most of this gap and its recent movements are driven by differences in labor force participation rates rather than by differences in unemployment rates. Fostering higher labor force participation of workers without a college degree, thus, would be quite helpful in promoting maximum employment.

Takeaways by Macro Roundup® AI

  1. Using the New York Fed's Economic Heterogeneity Indicators, the authors find the employment rate gap between workers who have completed college and those who have not exceeds the gaps between racial/ethnic groups or between men and women.
  2. The college/non-college employment gap is wider than the pre-pandemic gap, and most of the gap and its recent movements reflect differences in labor force participation rather than unemployment rates.
  3. The authors argue that fostering higher labor force participation among workers without a college degree would help promote maximum employment.

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  • Something Alarming Is Happening To The Job Market — Young college graduates have almost always had a lower unemployment rate than the overall labor force over the past four decades, but that gap recently hit an all-time low. One interpretation is that firms are replacing young workers with machines, though the surge in productivity growth such a shift would imply is hard to find in the data.
  • The Middle/Working Class Has Not Been “Hollowed Out” — Inflation-adjusted median weekly earnings for full-time workers with a high school diploma and no college degree reached their highest level on record in the latest data, rising 11% since 2000. Every US state recorded positive real median wage growth over that period.
Showing 96 database articles primarily about Unemployment/Participation