Return to education in bad times may be rational In recessions young workers exit the labour force more than other age groups. In many cases the young return to education, which may be a rational choice considering the lower opportunity cost of studying (expected value of job search is lower). Also a higher educational level improves labour market prospects for the worker.
Promoting transitions to education by increasing temporarily the number students may be optimal from the society’s perspective as well, as the opportunity cost in terms of lost output is lower in a recession.3  3  This view has been advocated by the 2010 Nobel laureate Christopher Pissarides.