It's crowded at the top: Freakonomics Radio
There is one anomalous data point in the overall job-market recovery: wages. Above, job seekers in San Francisco get information on openings.
The April unemployment numbers come out this Friday, after "weak" figures in March. But Stephen Dubner says there may be a larger, hidden side to the month-to-month swings in joblessness.
A "great reversal" in demand is what economist Paul Beaudry calls it. In the 1990s, there was healthy growth in jobs requiring a lot of education, and cognitive or technical skills.
"Then you start noticing that it has plateaued in 2000, even though more and more people are getting educated," Beaudry says. "It should have kept on going."
The result is that those high-educated workers are forced to take jobs further down the labor ladder than they were hoping for. What happens to the people who used to take those jobs?
"We started noticing all this cascading," Beaudry says. "I wouldn’t want to exaggerate -- it’s not like everyone is getting a barista job, but that’s exactly the feeling. It’s kind of like this pushing down."
So highly skilled workers go for the jobs of the lower-skilled. At the bottom of the ladder, workers can be pushed off entirely, into unemployment.
The effect has been masked, in part, by the financial crisis. Beaudry says things like banking and housing sectors may continue to improve, but this "cascading" will endure as a fundamental force dragging on the economy.
There may be a silver lining to all of this, before you get depressed.
With this recent push down the labor ladder, many highly trained and highly educated workers are going into the classroom.
This year, Teach For America received 57,000 applications -- the largest pool of interest in its history. On average, the program signs up fewer than 15 percent of those applicants, making it even more selective than many of the elite colleges where its new teachers graduate from.