Last week, I attended “It’s More than a Man-cession: The Real Demographics of Recession” at the Federal Reserve Bank of St. Louis. The event was inspired by the recent report by Howard Wall, an economist with the Fed, which explores how the recession is affecting different groups of people with an emphasis on the apparent gap between men and women. The night began with Howard’s presentation of his research and then moved into a panel discussion with several respected economists from the St. Louis region.
Howard explained that his goal for this project was to determine if the current recession has hurt men more than women, a theory that all the statistics seem to support. From the start of the recession in 2007, for instance, employment has dropped 5.7% for men and only 1.7% for women. These numbers make a great headline. Howard described how it’s easy for the media to latch onto these attention-grabbing figures and write stories about the intense hardships faced by men during the these tough times. Of course, it’s not that simple.
To explain his findings, Howard shifted the presentation into a close analysis of economic statistics, an area in which he’s clearly an expert. The colorful PowerPoint slides reminded me of some of the economics lectures I’ve had at school. There were several components to his argument, but his main assertion was that the mainstream media misses out what he calls “foregone employment.” This statistic looks beyond just job losses and describes employment that certain groups miss out on in a recession because they don’t continue their growth rate in the labor force. For example, if women were gaining jobs at a rate of 5% per year prior to the recession and then lost jobs at 2% per year during the recession, the total employment loss is 7%. There were charts and graphs and more charts of explanation, and they all came together to illustrate that the current recession has not exceptionally hurt men when considering foregone employment and other recessions of the past 50 years.
That myth out of the way, Howard shifted from looking at gender based groups to looking at demographics based on marital status, race, and education; he offered some insights as to why certain groups are losing more in the current recession. Here’s when the crucial point of his presentation emerged: it all comes back to education.
Unlike his conclusions about gender, all of Howard’s research suggested the recession has hurt those without any higher education strikingly more. Employment for those with associates or bachelor’s degrees has actually increased during the recession, but for individuals with only a high school diploma or less, there has been a severe drop. Some of the discrepancy between unemployment among men and women during the recession can be explained by the education gap. Women are much more likely to have a high school diploma than men, taking them out of the category that has been hit hardest. Further, women also receive associates degrees (such as those for nurses or dental hygienists) at much higher rates, and this group weathers downturns extremely well.
The importance of education continued to be the main theme when the panel discussion began, and they talked almost exclusively about how to change the mindset of students in the St. Louis region so they all strive for college degrees. In the increasingly competitive, international world, a bachelor’s degree is no longer a plus, but a vital asset for long-term success. Further, the rapid pace of technological development has amplified the need for lifelong education so individuals can remain competitive in the marketplace.
It seems the solution may have to be as complex as the problem. Howard stated that it is not as simple as spending more money on education. The school districts in Clayton and Ladue, for instance, spend roughly the same amount of money per student as the St. Louis Public School District, yet they are drastically higher on the achievement spectrum. The value students attach to education – college, in particular – depends heavily on the culture of the area. Low-income districts send fewer students to college, creating a cycle of disinterest in higher education that has proven extremely difficult to break.
The panelists were quick to assure the crowd that they are optimistic about Missouri’s future in spite of these problems. They believe things can improve, but we must take the right steps to make it happen.
Read the article on Howard’s report, The “Man-Cession” of 2008-2009: It’s Big, but It’s Not Great, in the latest issue of The Regional Economist, the quarterly magazine published by the Federal Reserve Bank of St. Louis. You can also explore their website to find additional economic resources and upcoming events.