Hazards Of Unemployment Research Articles

Duration structure of unemployment hazards and the trend unemployment rate

This paper develops a new method to estimate the trend unemployment rate in which the duration profile of unemployment hazards is taken into account. The duration profile is characterized by three time-varying elements—level, slope, and curvature. The model also recovers the duration component of trend unemployment rate and the trend mean duration of unemployment. The estimated trend unemployment rate declines by about 3 percentage points between 1980 and 2019. Its short-term duration component decreases, whereas the long-term component increases, resulting in a rise in the trend mean duration of unemployment. The opposite trends in duration components suggest falling frictional unemployment but rising structural unemployment.

The role of observed and unobserved heterogeneity in the duration of unemployment

SummaryThis paper studies the degree to which observable and unobservable worker characteristics account for the variation in the aggregate duration of unemployment. I model the distribution of unobserved worker heterogeneity as time varying to capture the interaction of latent attributes with changes in labor‐market conditions. Unobserved heterogeneity is the main explanation for the duration dependence of unemployment hazards. Both cyclical and low‐frequency variations in the mean duration of unemployment are mainly driven by one subgroup: workers who, for unobserved reasons, stay unemployed for a long time. In contrast, changes in the composition of observable characteristics of workers have negligible effects.

Factors Affecting on the Unemployment Hazard Rate of the Elderly Persons with Disabilities

본 연구는 고령 장애인의 노후 경제적 불안문제의 해법을 모색하기 위해서 장애인고용패널 2차 웨이브 종단자료를 활용하여 고령 장애인의 실업탈출 요인을 분석하였다. 이를 위해 사건사분석을 실시하였다. 분석결과, 첫째, 생명표 분석을 통해 실업기간별 고령장애인의 실업탈출 가능성의 변화를 분석한 결 과, 최장 실업기간(48개월)까지 실업상태로 남아 있는 비율은 77.57%이고 노동시장에 진입한 비율은 22.4%에 불과한 것으로 나타났다. 둘째, 고령 장애인의 실업탈출에 영향요인을 파악하고자 콕스비례헤 저드 모형으로 분석한 결과, 여성에 비해 남성의 경우, 연령이 낮을수록, 비수급가구일수록, 경증일수록, 건강상태가 양호할수록 실업탈출 가능성이 높아지는 것으로 분석되었다. 또한 교육수준이 낮을수록, 자 격증을 소유할수록 그리고 장애차별 경험이 없을수록 취업가능성이 높아지는 것으로 분석되었다. 이를 통해서 고령 장애인의 실업탈출을 촉진하기 위해서는 고령장애인의 인적자본을 강화하는 조치가 마련되어야 하며, 고령장애인의 노동시장 유인을 확대하기 위해 연령특성을 반영할 수 있는 방향으로 공공부조제도를 보완할 필요가 있음을 제시하였다. 끝으로 여성고령장애인의 실업탈출 확대를 위한 여성장애인 우대정책이 마련되어야 함을 제언하였다.This study analyzed the hazard of unemployment and the influencing factors on the rate of the elderly persons with disabilities. Data came from the secondary wave profile data of the Panel Survey of Employment for the Disabled(PSED). For the main purpose of this study, the life-table method was used for describing the patterns of unemployment duration by the Elderly Persons with Disabilities, and the cox proportional hazard model was used to identify significant factors on the unemployment duration. The results were as follows. First, according to the life table analysis, the unemployment rate of the elderly with disabilities to remain until the longest period of unemployment (48month) is 77.57%, and the rate of entry into the labor market was only 22.4%. Second, looking at the results from the cox proportional hazards model, the unemployment escape possibility was increased for those who are male, are the lower age, are non- public benefit recipient, have mild disability, have health condition and have less discrimination experiences. In addition, it was analyzed that the lower the level of education, having more the license, and the less experienced disability discrimination, the higher possibility of unemployment escape. With these results, it was suggested that measures should be taken to strengthen the human capital of the elderly with disabilities to promote unemployment of the elderly, and that the public assistance system needs to be supplemented in a way that reflects age characteristics in order to expand the incentive for the elderly. Finally, it was needed that the affirmative action for women with disabilities should be prepared to expand an escape from unemployment of women with elderly disabilities.

The effects of contract-type mismatch and matching frictions on unemployment duration: evidence for Portugal

ABSTRACT This paper analyses the impact of matching frictions in the Portuguese labour market on individual unemployment hazard rates and unemployment durations. The coexistence of permanent contracts and temporary contracts in the Portuguese (dual) labour-market is akin to a matching friction, with a contract-type mismatch between jobseekers who prefer permanent contracts, whereas firms, in turn, prefer to offer temporary contracts. The paper uses a rich micro dataset which allows to compute a time and space varying contract-type mismatch index, over 86 local labour markets (job-centers of the Portuguese Public Employment System) and five years. Employing discrete time hazard models and a stock-flow matching mechanism, we find that local labour markets with higher contract-type mismatch rates are characterized by lower hazard rates and longer unemployment duration. Improving the desirability of temporary contracts and information about local contract-type mismatch rates may reduce matching frictions and average unemployment duration.

The Role of Observed and Unobserved Heterogeneity in the Duration of Unemployment Spells

<ns2:p>This paper studies the degree to which observable and unobservable worker characteristics account for the variation in the aggregate duration of unemployment. I model the distribution of unobserved worker heterogeneity as time varying to capture the interaction of latent attributes with changes in labor-market conditions. Unobserved heterogeneity is the main explanation for the duration dependence of unemployment hazards. Both cyclical and low-frequency variations in the mean duration of unemployment are mainly driven by one subgroup: workers who, for unobserved reasons, stay unemployed for a long time. In contrast, changes in the composition of observable characteristics of workers have negligible effects.</ns2:p>

Is Separation from the Workplace a Psychiatric Emergency? The Role of the Clinician and the Consultant

Separation from the workplace is generally disruptive. Although weathered well by some, it can result in a literal lethal outcome for others. Psychiatry in general would benefit from greater awareness and understanding of how and when separation from work becomes a psychiatric emergency. Psychiatrists are well versed in handling psychiatric emergencies of possible harm to self or others. However, there is less training regarding how to address problems that are at high risk for occurring whenever a patient leaves work. Psychiatrists are in an ideal position to prevent disability and adverse health outcomes associated with unemployment. This article explores the health hazards of unemployment (including increased risk of death), positive consequences of working, and the important role psychiatrists play in setting appropriate expectations. Psychiatrists best serve patients and their employers by sustaining employment and helping their patients navigate workplace challenges and improve their work, which also likely to improve their self-efficacy. [ Psychiatr Ann . 2021;51(2):58–63.]

Youth Labor Market Prospects in Times of Economic Recession in Brazil

The article examines young people’s labor market prospects in Brazil during the most recent economic recession (2014–2017). We draw on data from the Continuous National Household Sample Survey (PNAD Continua), between 2012 and 2017, to estimate both average labor market indicators over time and proportional hazard models of unemployment and underemployment. We find that youths’ labor market prospects declined considerably over the period, and, as in many countries during economic downturns, young people were more affected than adults. The analysis shows that gender, race, and education impact the hazards of unemployment and underemployment among young Brazilians. Kaplan-Meier curves show that differences between white and African Brazilian youth, as well as between college-educated youth and high school graduates (or less), increased between 2016 and 2017, when economic activity was at its worst level.

Homeownership and unemployment: The effect of market size

This paper explores the effects of local labor market size on the unemployment hazard rate differential between renters and homeowners. Through a partial labor search-theoretic model, by explicitly modeling renters and owners, we find an asymmetric effect of the local labor market size on the unemployment hazard rate difference between renters and homeowners. We show that homeownership introduces additional frictions into the labor market especially when the local labor market is weak. We also show that these additional frictions make homeowners less mobile, and they become less likely to accept outside job offers, and more likely to accept local offers. Using data from the Survey of Income and Program Participation (SIPP), we find empirical evidence for the theoretical predictions of the model: (i) as local labor market opportunities deteriorate, homeowners become more likely to remain unemployed, (ii) homeowners have lower post unemployment wages than renters in local labor markets.

The gendered effects of substance use on employment stability in transitional China

ABSTRACTSubstance use is often thought to harm employment prospects, an assumption challenged by the anomaly that people who use licit substances such as alcohol and tobacco are sometimes at a lower risk of unemployment. We argue that employment stability may benefit from the socialisation afforded through using licit substances, particularly in a context where licit substance use is encouraged. Furthermore, because the norms associated with substance use often reflect the gender hierarchy in a society, the impact of substance use on employment stability may be contingent on an individual's gender. Applying Cox proportional hazard modelling to a panel dataset during the critical two decades of China's market-based transition (1991–2011), we found that the impact of substance use on unemployment hazards varies depending on the dosage of the use and the gender of the users. Compared to abstinence, moderate alcohol-drinking reduces the risk of unemployment, and the reduction benefits especially men. The standalone effect of tobacco-smoking is to elevate unemployment hazards; however, this effect is heavily moderated by gender so that female smokers were penalised while male smokers were rewarded in the labour market. Such patterns cannot be explained by community-level modernisation progress and individual-level covariates.

Time-Varying Employment Risks, Consumption Composition, and Fiscal Policy

This study examines the response of aggregate consumption to active labor market policies that reduce unemployment. We develop a dynamic general equilibrium model with heterogeneous agents and uninsurable unemployment as well as policy regime shocks to quantify the consumption effects of policy. By implementing numerical experiments using the model, we demonstrate a positive effect on aggregate consumption even when the policy serves as a pure transfer from the employed to the unemployed. The positive effect on consumption results from the reduced precautionary savings of the households who indirectly benefit from the policy by a decreased unemployment hazard in future.

Observation Through Fiction: Frank Norris and E. M. Forster

Some novelists in the nineteenth century, for example Harriet Martineau and Charles Dickens, used fiction to illustrate the economic behavior postulated by the early political economists and their critics. “Realist” novelists later in this century and into the twentieth examined aspects of the economy as background for their storytelling. This essay looks at the work of two realist novelists who observed economic circumstances in their time with unusual subtlety and perception. Frank Norris in The Octopus, influenced perhaps by Thorstein Veblen, described western expansion in the United States on the new farms and ranches, driven by the railways. Then he examined the Chicago commodities exchange in The Pit as a manifestation of the new global economy. E.M. Forster, a friend of John Maynard Keynes, focused in Howards End on the hazards of unemployment and destruction of the environment in a modern market economy. In Passage to India he demonstrated that the notion of empire and of the white man’s burden was obsolete. Neither of these novelists saw himself as a contributor to economics, but both contributed to the popular understanding of the economy.

Unemployment Duration and Business Cycle in Argentina: A Quantile Regression Analysis

Argentina constitutes an interesting case for the analysis of the labour market given that during the nineties it reached high economic growth rates and a stable macroeconomic environment together with a significant raise in unemployment. This dynamic was associated to increases in the entry flows to unemployment and the average duration of these episodes. The proportion of long-term unemployment also grew significantly.The aim of this paper is twofold. First, to evaluate the presence of differential effects of the business cycle and changes in the productive structure on unemployment hazard rates along the elapsed unemployment duration of the spells. Second, to test the validity of the proportional assumption imposed in most of the studies about unemployment duration as well as to propose the use of an alternative econometric method. Censored quantile regressions will be used in order to estimate in a more flexible and robust way the effect of covariates on the conditional distribution of duration. This is the first study in applying this methodology to unemployment duration in Argentina. The results indicate that the reduction of the labour opportunities implied an increase in unemployment duration, especially for those unemployed with long-term episodes. As a consequence, the long unemployment spells became even longer during the period under analysis.

PROTOCOL: The effect of benefit exhaustion on unemployment

PROTOCOL: The effect of benefit exhaustion on unemployment

The Impact of Territorially Concentrated FDI on Local Labor Markets: Evidence from the Czech Republic

This paper investigates the impact of a large territorially concentrated FDI inflow on local labor market outcomes using district panel data from the Czech Republic. Toyota-Peugeot's joint investment in Kolin is used to quantify the effect of FDI on the district unemployment outflow and inflow rates, the aggregate unemployment exit hazard rates, and subsequently both the unemployment rate and the employment rate. Using difference-in-differences analysis, labor market performance of 'treatment' and 'control' districts for two periods (before and after the investment) are compared. Placebo simulations reveal that conventional least squares estimates lead to serious underestimation of standard errors. Therefore, in order to account for serial correlation, the block bootstrapping technique is used to compute consistent standard errors. The results indicate a positive significant impact of the investment on the local unemployment outflow rate driven mainly by increases in the aggregate unemployment hazard rates for durations less than nine months. However, the impact on longer unemployment durations remained negligible. Consequently, the local unemployment rate decreased and the employment rate increased in the 'treated' district.

Does Union Dissolution Lead to Unemployment? A Longitudinal Study of Health and Risk of Unemployment for Women and Men Undergoing Separation

Research on the socio-economic consequences of divorce or union dissolution has largely focused on women's loss of income after separation. Scant attention has been paid to the effects of union dissolution on individuals’ employment. Expanding the literature on the interlocked effects of divorce and health on labour market outcomes, the aim of this paper is to examine the consequences of union dissolution on employment for both women and men. The data on which this study is based are drawn from the Swiss Household Panel (SHP) study. Using Cox proportional hazards regression models, I estimate the effects of union disruption on unemployment for employed men and women in a marriage or cohabitating union over the period of 1999–2004. Findings indicate that individuals whose unions end are at a greater risk of unemployment compared to their married/cohabiting counterparts. Results also suggest the presence of relevant gender differences in the ways in which women and men experience union dissolution in relation to their labour market position. Men's hazard of unemployment is higher than that of their female counterparts, even after controlling for crucial gendered variables.

Asynchronous risk: retirement savings, equity markets, and unemployment

Retirement savings in defined contribution plans vary as a result of the timing and frequency of unemployment spells. We hypothesize that unemployment is coincident with negative shocks to equities prices, implying workers may systematically miss investment opportunities. First we match historic stock returns to unemployment hazards by gender, and earnings quartile. Next we test the relationship between unemployment, equity returns, and pension savings, by repeated simulation. Finally, we find that the timing of unemployment spells amplifies retirement savings losses on average for all worker-types in our analysis. Timing impacts are observed to be largest for high earnings workers and to increase with unemployment losses disproportionately.

The health hazards of unemployment and poor education: The socioeconomic determinants of health duration in the European Union

The effect of socioeconomic status on the likelihood that an individual enters a period of poor health is examined using an Accelerated Failure Time methodology. This study employs data from the European Community Household Panel for the years 1994–2002 across 13 European countries, using the Physical and Mental Health Problems, Illnesses and Disabilities measure of physical health. Some socioeconomic status indicators do impact on the length of time an individual remains in good health – these being unemployment, which has a negative effect, and education, which has a positive effect – but others, such as income, have far less of an impact. Age and gender effects are also found.

Job separation in a non‐stationary search model: a structural estimation to evaluate alternative unemployment insurance systems

AbstractThis paper considers a job search model in which the environment is not constant throughout the unemployment spell and where jobs do not last for ever. In this situation, reservation wages can be lower than they would be in a model without consideration of such separations, but they can initially be higher precisely because of the non‐constant environment. The model is estimated structurally by using Spanish data for the period 1985–1996. The main finding is that, after controlling for unobserved heterogeneity, the unemployment hazard rate is almost flat during the first six months. However, after this duration, the highly decreasing job offer arrival rate comes to be the only significant factor, given that acceptance probabilities become equal to one. The estimated parameters are used to evaluate different unemployment insurance designs. We conclude that a non‐monotonic pattern in unemployment benefits, joint with a tax paid by workers and based on unemployment duration, makes this duration 13.2% lower than it currently is in Spain. Copyright © 2006 John Wiley & Sons, Ltd.

Unemployment Duration and Workers' Wage Aspirations in Spain

This paper examines unemployed workers' declared willingness to work for a wage lower than the one warranted by their qualification. We analyze which personal and economic characteristics determine this willingness and how it changes as unemployment spells lengthen. Moreover, we also study the influence of this willingness on unemployment duration. The main results are: (i) Young workers, those less educated and those living in regions with high unemployment show a more positive attitude towards accepting lower wages while married women with a working husband show more negative attitudes; (ii) The exhaustion of unemployment benefits has positive effects in the transition probability of the attitude from negative to positive; (iii) The effect of this attitude on the unemployment hazard rate is positive but only marginally significant which may be showing that this willingness is not only reflecting the worker's reservation wage but also some unobserved heterogeneity; (iv) The negative duration dependence of the unemployment hazard rate is substantially reduced when unobserved heterogeneity is controlled for.

Health hazards of unemployment–only a boom phenomenon? A study of young men and women during times of prosperity and times of recession

Background: It has been suggested that high unemployment rates in society may be less harmful to the health of people than low unemployment rates. Therefore, a study was carried out to compare, among young men and women, the relationship between health and long-term unemployment during periods of rapid economic growth ‘boom’ and economic recession. Methods: Two study groups were chosen at age 21 y (5 y after compulsory schooling ended) from an industrial town in northern Sweden. The first group (number 1083) was chosen and surveyed in 1986 (under ‘boom’ conditions); the second (number 898) was chosen in 1994 (under economic recession conditions). The non-response rate was 2% for the boom group and 10% for the recession group. The main outcome measurements examined were somatic and psychological symptoms. Results: Health criteria for general health among long-term unemployed young men and women did not differ between the group surveyed in boom conditions and the group surveyed in recession conditions. The only exception was for psychological symptoms, which scored lower among the men in the recession group. Individual unemployment had a high explanatory power for poor health, in particular, psychological ill health. Conclusions: When comparing periods of boom and recession there was no difference in somatic and psychological symptoms for those who were long-term unemployed. Thus, the trade cycle appeared to have had no impact on their health. Public Health (2000) 114, 25–29.