The Employment Effects of Recession on Couples in the UK: Women's and Household Employment Prospects and Partners’ Job Loss

Abstract

AbstractThe effect that the 2008/09 recession has had on unemployment and, in particular, on the distribution of job losses across households is of key concern to policymakers. During the 1991 recession rising male unemployment was associated with a sharp increase in the number of workless households, with this polarisation of work between ‘work-rich’ and ‘work-poor’ persisting many years later. Part of the reason for this polarisation was that the design of the tax and benefit system produced weak work incentives for women partnered to unemployed men, particularly if the jobs open to them were either part time or low paid. Since 1999, the United Kingdom has undertaken reform of employment and transfer programmes, with a particular focus on boosting incomes and work incentives for families with children. The resulting literature focussed on the impact that these reforms had on women's movements into employment. Since the economy entered recession in 2008, an increasingly important question is how have these reforms affected women's decisions to remain in employment (or enter into work) if their partner becomes unemployed. This paper usesLabour Force Surveydata to assess the effect of male job loss on their partners' employment and to examine the implications for the distribution of jobs across households. Results suggest that working women whose partners lost their jobs in the 2008/09 recession were more likely to remain in work than before and this has helped to mediate the growth in workless couple households.