The wounds that do not heal: The life-time scar of youth unemployment
Research output: Contribution to journal › Article › peer-review
Colleges, School and Institutes
- University of Nottingham
- University of Leicester
This paper uses UK administrative data to study the long-term effects of unemployment on earnings. It is the first paper to pinpoint accurately the relative importance of the timing of employment shocks within workers’ lives. We find a strong effect of events in the first few years after entry into the labour market: each month of unemployment between ages 18 and 20 causes a permanent income loss of 1.2% per year. This scar effect of youth unemployment is lower when it happens when the worker’s age is between 21 and 23, and it disappears altogether in the next three-year age period. The scar effect is most severe for individuals at the lower end of the ability distribution.
|Early online date||4 Aug 2021|
|Publication status||E-pub ahead of print - 4 Aug 2021|