The Pew Economic Mobility project has an interesting report out on how people recover from adverse income shocks. The report itself has a somewhat weirdly positive spin on their own data, focusing on the fact that recovery rates haven’t gotten worse over time. I think the basic facts, though, are pretty sobering — it takes many people a long time to recovery from adverse shocks. There’s also considerable inequality-reenforcing demographic variance around educational achievement. Just consider this in the recent period:
One more reason that it’s important to raise college graduation rates. It also helps to find someone to cohabit with:
Interestingly, while this information doesn’t quite support the view that a recession-stricken woman needs a man like a fish needs a bicycle, it does suggest that a recession-stricken man needs a woman more.
But of course this is data from 1995–2004 a period during which labor market conditions were good on average. Right now, we’re entering a period during which labor market conditions will be the worst they’ve been since the start of World War II and will likely stay that way for a good long time. Presumably, that will make it harder to recover from this kind of thing.