Effect Of Unemployment Duration Research Articles

Human Capital Depreciation and Stigma Effects in Unemployed Workers’ Re-Employment Wages

Using the data from the Survey of Income and Program Participation (SIPP) between 1996 and 2013, the effects of unemployment duration on the re-employment wages for workers 40 years of age and older are empirically estimated using a quasi-structural model. The findings indicate that the re-employment wages for workers over age 40 decrease by 0.9% for each month that a worker remains unemployed. Hence, the longer the worker remains unemployed, the lower are his/her re-employment wages. The duration of unemployment effect is decomposed into the human capital depreciation and stigma effects with the stigma effect referring to potential employers’ perception, or possible misperception, of older workers as being lower productivity workers the longer they remain unemployed. The estimated coefficient of the human capital depreciation is statistically insignificant, which indicates that the observed reduction in re-employment wages for older workers is mainly explained by the stigma effect.

Whom Do Employers Want? The Role of Recent Employment and Unemployment Status and Age

We use a resume audit study to better understand the role of employment and unemployment histories in affecting callbacks to job applications. We focus on how the effect of career history varies by age, partly in an attempt to reconcile disparate findings in prior studies. While we cannot reconcile earlier findings on the effect of unemployment duration, the findings solidify an emerging consensus on the role of age and employment on callback. First, among applicants across a broad age range, we find that applicants with 52 weeks of unemployment have a lower callback rate than do applicants with shorter unemployment spells. However, regardless of an applicant's age, there is no relationship between spell length and callback among applicants with shorter spells. Second, we find a hump-shaped relationship between age and callback, with both younger and older applicants having a lower probability of callback relative to prime-aged applicants. Finally, we find that those applicants who are employed at the time of application have a lower callback rate than do unemployed applicants, regardless of whether the interim job is of lower or comparable quality relative to the applied-for job. This may reflect a perception among employers that it is harder or more expensive to attract an applicant who is currently employed.

Perceptions Of Unemployed Workers: Unemployment Duration, Volunteerism, And Age

This study investigated the effects of unemploymentduration, volunteerism and age on perceptions of unemployed job candidates. Anexperimental design was employed in which participants judged fictitiousresumes of unemployed candidates. Wefound that candidates unemployed for 18 months were viewed as less qualifiedand would be less likely to be interviewed and hired than those unemployed for6 or 12 months at all age levels (30, 40, 50) studied. Candidates who hadperformed volunteer work (career- or non-career-related) would be more likelyto be interviewed and hired than those who had not volunteered. Implications of the findings were discussed.

The effect of job loss and unemployment duration on suicide risk in the United States: a new look using mass‐layoffs and unemployment duration

We examine the link between employment status and suicide risk using a panel of US states from 1996 to 2005 with monthly data on suicides, the duration of unemployment spells and the number of job losses associated with mass-layoff events. The use of aggregate data at the monthly level along with the distribution of unemployment duration allows us to separate the effect of job loss from the effect of unemployment duration, an important distinction for policy purposes, especially for the timing of potential interventions. Our results are consistent with unemployment duration being the dominant force in the relationship between job loss and suicide. Nevertheless, mass-layoffs may be powerful localized events where suicide risk increases shortly afterward. Implications for the design of unemployment insurance are discussed.

Unemployment and Subsequent Earnings: Estimating Scarring Among British Men 1984–94

This paper estimates the impact of unemployment on earnings following re-employment for a large and representative sample of British men, 1984–94. Unemployment incidence is found to have only a temporary effect, an average earnings setback of 10% on initial re-engagement largely eroding over two years. The effect of unemployment duration, by contrast, is permanent, a one-year spell adding a further penalty of 10 percentage points. These wage penalties are least for young men and the low paid – those most at risk of unemployment – and greatest for prime age and highly paid men.

Unemployment and Subsequent Earnings: Estimating Scarring Among British Men 1984-94

This paper estimates the impact of unemployment on earnings following re-employment for a large and representative sample of British men, 1984-94. Unemployment incidence is found to have only a temporary effect, an average earnings setback of 10% on initial re-engagement largely eroding over two years. The effect of unemployment duration, by contrast, is permanent, a one-year spell adding a further penalty of 10 percentage points. These wage penalties are least for young men and the low paid - those most at risk of unemployment - and greatest for prime age and highly paid men.

Wage Effects of Unemployment Duration and Frequency

This paper analyzes the wage effects of unemployment duration and frequency for different regional labor market situations in The Netherlands using a simultaneous equations approach. The main finding is that unemployment duration has a significant negative effect and the frequency of unemployment a significant positive effect on wages in the core regions with relatively low unemployment rates. In the periphery with relatively high unemployment rates no significant effects of unemployment duration and frequency are found. It is argued that in the core regions unemployment duration is primarily viewed as a personal indicator of low productivity whereas in the periphery it is attributed to the situation in the regional labor market.

The effect of unemployment duration on national suicide rates: a time series analysis, 1948-1982.

The relationship between unemployment and suicide in the United States is examined. Data for the period 1948 to 1978, primarily from the U.S. Public Health Service, are used to examine the effect of the duration of unemployment on suicide. "The results of a Cochrane-Orcutt iterative regression analysis indicate that the greater the duration of unemployment the greater the suicide rate. Using ex post forecasting techniques it is estimated that increases in unemployment during the Reagan administration have been associated with at least 929 additional deaths from suicide."