The Effect of Job Loss on Health: Evidence from Biomarkers

33 Pages Posted: 8 Nov 2014

See all articles by Pierre-Carl Michaud

Pierre-Carl Michaud

University of Quebec at Montreal (UQAM) - Department of Economics; Centre Interuniversitaire sur le Risque, les Politiques Economiques et l'Emploi (CIRPÉE); RAND Corporation, Labor and Population; IZA Institute of Labor Economics; Netspar

Eileen Crimmins

University of Southern California - Davis School of Gerontology; University of Southern California - Schaeffer Center for Health Policy and Economics

Michael D. Hurd

RAND Corporation; State University of New York at Stony Brook - College of Arts and Science - Department of Economics; National Bureau of Economic Research (NBER)

Abstract

The effect of job loss on health may play an important role in the development of the SES-health gradient. In this paper, we estimate the effect of job loss on objective measures of physiological dysregulation using longitudinal data from the Health and Retirement Study and biomarker measures collected in 2006 and 2008. We use a variety of econometric methods to account for selection and reverse causality.Distinguishing between layoffs and business closures, we find no evidence that business closures lead to worse health outcomes. We also find no evidence that biomarker health measures predict subsequent job loss because of business closures. We do find evidence that layoffs lead to diminished health. Although this finding appears to be robust to confounders, we find that reverse causality tends to bias downward our estimates. Matching estimates, which account for self-reported health conditions prior to the layoff and subjective job loss expectations, suggest even stronger estimates of the effect of layoffs on health as measured from biomarkers, in particular for glycosylated hemoglobin (HbA1c) and C-reactive protein (CRP). Overall, we estimate that a layoff could increase annual mortality rates by 9.4%, which is consistent with other evidence of the effect of mass layoffs on mortality.

Keywords: job loss, health, SES-health gradient, biomarkers

JEL Classification: I14, J10, J14

Suggested Citation

Michaud, Pierre-Carl and Crimmins, Eileen and Hurd, Michael D., The Effect of Job Loss on Health: Evidence from Biomarkers. IZA Discussion Paper No. 8587, Available at SSRN: https://ssrn.com/abstract=2520742

Pierre-Carl Michaud (Contact Author)

University of Quebec at Montreal (UQAM) - Department of Economics ( email )

P.O. Box 8888, Downtown Station
Montreal, Quebec H3C 3P8
Canada

Centre Interuniversitaire sur le Risque, les Politiques Economiques et l'Emploi (CIRPÉE) ( email )

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Ste-Foy, Quebec G1K 7P4
Canada

RAND Corporation, Labor and Population ( email )

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United States

IZA Institute of Labor Economics ( email )

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Bonn, D-53072
Germany

Netspar ( email )

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Netherlands

Eileen Crimmins

University of Southern California - Davis School of Gerontology ( email )

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Los Angeles, CA 90089-0191
United States

University of Southern California - Schaeffer Center for Health Policy and Economics ( email )

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United States

Michael D. Hurd

RAND Corporation ( email )

P.O. Box 2138
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Santa Monica, CA 90407-2138
United States
310-393-0411 (Phone)
310-393-4818 (Fax)

State University of New York at Stony Brook - College of Arts and Science - Department of Economics ( email )

Stony Brook, NY 11794
United States

National Bureau of Economic Research (NBER)

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Cambridge, MA 02138
United States

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