Final answer:
The higher university enrollment in Canada during periods of high unemployment can be attributed to additional education offering better connections to the labor market and higher demand. Low-skilled workers have less attractive labor market opportunities, making higher education a desirable option for better employment prospects and higher earnings.
Step-by-step explanation:
The observed trend of higher university enrollment during periods of high unemployment in Canada can be explained by the fact that additional education typically offers better connections to the labor market and higher demand. This is supported by the unemployment rates for different education levels in early 2013 and January 2017. For example, in January 2017, the unemployment rate for those with a college degree was 2.5%, while for those without a high school diploma, it was 7.7%.
The pattern arises because low-skilled workers face less attractive labor market opportunities compared to highly-skilled workers, including lower pay. As a result, low-skilled workers may be less motivated to find jobs. This leads to an inclination towards pursuing higher education as a means to secure better employment prospects and higher earnings.