The impact of youth labour market experiences on later employment opportunities: What roles do ethnicity and gender play?

Abstract

Youth joblessness often leaves a scar. However, some ethnic groups appear to be more successful in recovering from this than others. Using a unique dataset (ONS Longitudinal Study) linking census records for a 1% sample of the population of England and Wales, we examine the relationship between early labour market experiences and later employment outcomes for men and women from Indian, Pakistani, Bangladeshi and Caribbean origins to those of white British individuals. Our results show that, on average, being unemployed or inactive in youth (vs being employed or in education) reduces employment opportunities later in life. However, this varies greatly by ethnicity and gender: Indian and, especially, Bangladeshi men are substantively less affected by previous non-employment compared with white British men; for women, having an ethnic minority background continues to limit their labour market integration. Addressing gender and ethnic labour market inequalities requires a more nuanced understanding of how these disadvantages unfurl over time for different communities.