A new IAM video examines recent evidence showing that while unemployment poses serious financial consequences for many families, losing a job can also have lasting negative effects on one’s physical and mental health, as well as increase their rate of mortality.
As shown in “The Scars of Unemployment,” the Economic Policy Institute recently held a panel discussion in which a number of speakers spoke about individual studies they conducted on the negative effects of unemployment, especially long-term unemployment. Researchers concluded that workers who lost their jobs more than doubled their risk of a heart attack and stroke, compared to those who had steady employment. Another study found that 83 percent of workers who had experienced workplace closures were more likely to report new health conditions or psychiatric problems, such as depression, anxiety and low self-esteem. Researchers also found that those who lost their jobs experienced a shorter life expectancy.
Columbia University Professor Till von Wachter says losing a job can no longer be looked at as just a temporary financial burden. “The cost of recessions is probably bigger than what we thought it was,” said von Wachter. “Typically, costs of recessions are measured by short-term earnings lost. But it turns out the earnings losses last over 20 years and there are significant costs in terms of health – and those also last 20 years.”
Experts believe the country needs to start thinking differently about what it means to be unemployed. “We don’t often think of unemployment insurance or job search assistance as a health policy,” said Kate Strully, a professor at the University of Albany, State University of New York. “But given the links between the psychological components of job loss – stress, disease, financial strain – it’s quite possible that there may be health benefits, that we currently aren’t capturing, related to these sorts of programs.”