Unemployment and Subsequent Earnings: Estimating Scarring Among British Men 1984-94

40 Pages Posted: 6 Jun 2001

See all articles by Mary Gregory

Mary Gregory

University of Oxford - Department of Economics

Robert Jukes

Credit Suisse AG - London Headquarters

Multiple version iconThere are 2 versions of this paper

Date Written: March 2001

Abstract

This paper estimates the impact of unemployment on earnings following re-employment for a large and representative sample of British men, 1984-94. Unemployment incidence is found to have only a temporary effect, an average earnings setback of 10% on initial re-engagement largely eroding over two years. The effect of unemployment duration, by contrast, is permanent, a one-year spell adding a further penalty of 10 percentage points. These wage penalties are least for young men and the low paid - those most at risk of unemployment - and greatest for prime age and highly paid men.

Keywords: Scarring, displaced workers, unemployment, re-engagement, earnings profiles

JEL Classification: J3, J6

Suggested Citation

Gregory, Mary and Jukes, Robert, Unemployment and Subsequent Earnings: Estimating Scarring Among British Men 1984-94 (March 2001). Available at SSRN: https://ssrn.com/abstract=271449 or http://dx.doi.org/10.2139/ssrn.271449

Mary Gregory (Contact Author)

University of Oxford - Department of Economics ( email )

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Robert Jukes

Credit Suisse AG - London Headquarters ( email )

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United Kingdom

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