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US – Employability makes unemployment to trickles down to lower-skilled workers research finds

Unemployment “trickles down” to America’s poorest and most vulnerable because, during recessions, higher-income workers with more education take jobs that are below their qualification level, according to new research.Capture d’écran 2014-09-04 à 10.09.55

Such underemployment, in turn, leaves fewer job openings for which the so-called lower-skilled workers are qualified.

“Some high-skill workers move down the occupational ladder in order to find a job more easily,” write Regis Barnichon and Yanos Zylberberg, economists at CREI, Universitat Pompeu Fabra, in Barcelona. “Through this process, unemployment trickles down from the upper-occupation groups to the lower-occupation groups, so that high-skill workers enjoy not only higher expected income but also lower income volatility.”

“Job competition is biased and favors high skills, because a high-skill worker applying to a low-skill job is systematically hired over competing low-skill applicants,” the CREI research paper finds.

“Trickle-down unemployment can be a powerful redistributive mechanism” that further boosts already historically elevated levels of income inequality, the authors add.

Chosen excerpts by Job Market Monitor. Read the whole story at Unemployment Trickles Down to Poorer Workers, Study Finds – Real Time Economics – WSJ.

Related Post

US – The underemployment of college graduates is displacing lower skilled workers

The jobless rate of Americans ages 25 to 34 who have only completed high school grew 4.3 percentage points to 10.6 percent in 2013 from 2007, according to Bureau of Labor Statistics data. Unemployment for those in that age group with a college degree rose 1.5 percentage points to 3.7 percent in the same period. … Continue reading 

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