Abstract:

The business cycle, also termed the economic or bust-to-boom cycle, is the upward and downward movement in economic activity over the long-term. It is measured by real gross domestic product (GDP) or other macroeconomic indicators such as unemployment. It is typically characterised by four phases – recession, recovery, growth and decline. A business cycle is not a regular, predictable or repeating phenomenon, its timing is random and, to a large degree, unpredictable. Upward movement in economic activity or periods of economic prosperity are typically called expansions or booms. Downward movement, or periods of economic decline, are called recessions or depressions. It is the combination of expansions and contractions, the ebb and flow of economic activity that makes up the business cycle. Expansion is measured from the trough (or bottom) of the previous business cycle to the peak of the current cycle, while recession is measured from the peak to the trough. During a period of expansion, output of goods and services increases, employment rises, new construction expands, and inflation increases. Conversely, during a recession, output declines, unemployment rises, new construction declines and inflation falls, with the possibility of deflation.
In the United States of America (USA), according to the National Bureau of Economic Research (NBER), there were 12 business cycles from 1945 to 2014. The average length of a cycle was circa 69 months. The USA’s current period of expansion began in June 2009, the period when the recession of 2007-2009 reached its trough. In Ireland, the period from 1960 to 2014 produced 10 business cycles. The average length of a cycle was 60 months. The current Irish period of expansion began in quarter three of 2010. Unemployment rates are a good indicator of economic activity. During the period 2002-2015 fluctuations were significant, with standardised unemployment rates increasing from 4.5% in January 2002 to 15% in December 2011, and decreasing to 10.1% in February 2015. At the bottom of a cycle the effects are worse for the unskilled, increasing unemployment and competition for the remaining jobs. The expectation is that business cycle variations are related to opportunities for employment at graduation and so may have an impact on the number entering third level education.
The purpose of this paper is to map the numbers of second level students entering third level education in Ireland during the business phases of the period 2002 to 2015. The period in question covers both upturns and downturns of the business cycle, providing an opportunity to consider the impact of the cycle on numbers entering higher education. Based on the data presented conclusions will be drawn which may assist long-term educational policy making in Ireland.

Keywords:

Business cycle, higher level education participation, career choice.