Working Paper: NBER ID: w17040
Authors: Henry S. Farber
Abstract: The Great Recession from December 2007 to June 2009 is associated with a dramatic weakening of the labor market from which the labor market is now only slowly recovering. The unemployment rate remains stubbornly high and durations of unemployment are unprecedentedly long. I use data from the Displaced Workers Survey (DWS) from 1984-2010 to investigate the incidence and consequences of job loss from 1981-2009. In particular, the January 2010 DWS, which captures job loss during the 2007-2009 period, provides a window through which to examine the experience of job losers in the Great Recession and to compare their experience to that of earlier job losers. These data show a record high rate of job loss, with almost one in six workers reporting having lost a job in the 2007-2009 period. The consequences of job loss are also very serious during this period with very low rates of reemployment, difficulty finding full-time employment, and substantial earnings losses.
Keywords: Job Loss; Great Recession; Labor Market; Displaced Workers Survey
JEL Codes: J63; J64
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| job loss (J63) | lower reemployment rates (J68) |
| job loss (J63) | reduced earnings (J31) |
| job loss (J63) | long durations of unemployment (J64) |
| long durations of unemployment (J64) | economic costs of job loss (J65) |
| job loss during 2007-2009 (F66) | higher job loss rates (J63) |
| lower reemployment rates (J68) | reduced earnings (J31) |