Labor Market Conditions and Racial/Ethnic Differences in College Enrollment

Abstract

Listen

Translate article

The racial/ethnic differences in college enrollment are pervasive and persistent. In this article, I provide evidence of a business cycle-driven component to the college enrollment gaps among racial/ethnic groups in the USA. Using a nationally representative sample from the National Longitudinal Survey of Youths 1997 (NLSY97) and fixed-effects enrollment probability models, I find that Hispanics are more likely than non-Black-non-Hispanics to enroll in 2-year college during high unemployment periods. Similarly, I find that individuals who are Black are more likely than non-Black-non-Hispanic individuals to enroll in 2-year colleges but are less likely to enroll in 4-year colleges during periods of high unemployment. The positive effect of high unemployment rate on 2-year college enrollment for Blacks is almost entirely offset by negative effects on 4-year college enrollment. Non-Black-non-Hispanics are least sensitive to labor market conditions. The cyclicality of college enrollment rates of Blacks and Hispanics and the relatively smooth enrollment rates of non-Black-non-Hispanic individuals may be able to explain a part of the persistent gap in college enrollment.