The Impact of Unemployment on Families

Abstract

4. William S. Hoffman, Ph.D., is Director (retired), Michigan Health and Social Security Research Institute, International Union - United Auto Workers, Detroit, Michigan, 48214.From 1979 to 1984, more than 11.5 million workers lost their jobs because of closings in the nation's industries. Manufacturing industries provide 20% of the nation's employment and have experienced tremendous cutbacks and closings (Bluestone & Harrison, 1982; Perrucci, Perrucci, Targ, & Targ, 1988). Various causes for closing have been identified, including poor corporate planning, ill-founded federal policy, capital flight, decreasing profit rates, and the pursuit of lower labor costs. The automotive industry continues to be severely affected by shutdowns. Although the corporate terminology may change--plant closings are sometimes called plant idling--the effects on workers and their families are similar and severe.Almost 40% of all the U.S. auto employment has been located in Michigan. As a result of the 1980s recession in the auto industry, Michigan's economy suffered considerably. The Detroit and Flint area economies were especially hurt by industrial decline. In 1982, annual unemployment rates in these areas were as high as 16% and 21.2%, respectively, and in January 1988 the rates were still far above the national average of 5.8%-10.3% in Detroit and 17.7% in Flint.Jobs demanding skills and training such as those required in the automotive industry are becoming increasingly scarce. Although the service industry sector of the economy has continued to expand in the 1980s and 1990s, many of the available jobs are low paying with commensurate low skill requirements. Thus, for the worker, shutdowns mean lower pay (if work can be found), long periods of unemployment, and eventual loss of benefits such as health coverage and unemployment compensation.Many studies have similarly argued that marriage and family life are negatively affected by the unemployment experience (Atkinson, Liem, & Liem, 1986; Dew, Bromer, & Shulberg, 1987; Elder & Caspi, 1988; Jackson & Walsh, 1987; Liem & Liem, 1988; Liem & Rayman, 1982; Moen, 1979; Moen, Kain, & Elder, 1983; Nowak & Snyder, 1984; Schlozman & Verba, 1979; Voydanoff & Donnelly, 1988). This work shows conclusively how emotional distress arising from job loss affects both the job loser and other family members. Some studies have linked unemployment to levels of violence in the family (Straus, Gelles, & Steinmetz, 1980). Others have reported an increase in levels of family friction, tension, and arguments as a result of unemployment (Grayson, 1985; Hakim, 1982; Komarovsky, 1962). Further, a recent review documents many negative effects of parents' unemployment and associate financial distress on children (McLoyd, 1989).In this paper, we examine data on unemployment, and assess its impact on workers and their families. We first review the methods employed to collect the data upon which our analyses are based.MethodsTHE SURVEYSIn November 1986, General Motors (GM) announced that it would be closing nine plants and parts of two others by 1990; most closings were scheduled to occur by the end of 1987. We designed a prospective quasi-experimental panel survey, comparing workers from four of the closing plants with workers from twelve non-closing plants at three points: three months before the closings, one year after, and two years after.The Wave 1 survey was an approximately one-hour long interview, conducted face-to-face during August-October 1987. The measures in this survey included items about workers' financial status, mental and physical health, family conflict, self-blame and coping, social support, life events, employment history, and future plans. Respondents were drawn from four closing and twelve comparison group plants located in the Detroit and Flint areas of southeastern Michigan. …