Which degrees do students prefer during recessions?

We examine how changes in the unemployment rate affect demand for tertiary education, demand for different fields of university study and degrees’ admission thresholds. We use panel data for applications submitted to every undergraduate program in Greece that span seven rounds of admission cohorts combined with a degree-specific job insecurity index, and time series on youth (ages 18–25) unemployment. We find that degree- and major-specific job insecurity turns applicants away from degrees and majors that are associated with poor employment prospects. Results indicate that the steep increase in the unemployment rate that started in 2009 is associated with an increase in the number of university applicants. The effect is heterogeneous across fields, with an increase in the demand for degrees in Psychology as well as for entrance to Naval, Police, and Military Academies, and a decrease in the demand for degrees in Business and Management. We also find that the business cycle changes degrees’ admission thresholds by affecting their popularity.