Unemployment vs. school enrollment
Just finished a paper on cyclicality of university/college with regards to the business cycle. Used a 10 year data set with ~12,000 people aged 16-25. Turns out that in Canada, just like the united states, when unemployment rises by 1% school enrollment increasess by 0.8%
There are two factors at play, lower opportunity costs and higher credit/liquidity constraints. The opportunity costs tend to dominate the decision making process but I wonder if the current recession will follow that same path with regards to school enrollment. I tend to think liquidity/credit constraints will have a larger impact this time around relative to opportunity costs.