Toward a Better Estimation of the Effect of Job Loss on Health

Abstract

Previous research has shown that involuntary job loss may have negative health consequences, but existing analyses have not adequately adjusted for health selection or other confounding factors that could reveal the association to be spurious. Using two large, population-based longitudinal samples of U.S. workers from the Americans' Changing Lives Study and the Wisconsin Longitudinal Study, this analysis goes further by using respondents' self-reports of the reasons for job loss and information about the timing of job losses and acute negative health shocks to distinguish health-related job losses from other involuntary job losses. Results suggest that even after adjustment for numerous social background characteristics and baseline health, involuntary job loss is associated with significantly poorer overall self-rated health and more depressive symptoms. More nuanced analyses reveal that among involuntary job losers, those who lose their jobs for health-related reasons have, not surprisingly, the most precipitous declines in health. Job losses for other reasons have substantive and statistically significant effects on depressive symptoms, while effects on self-rated poor health are relatively small.