The Bilateral Relationship between Depressive Symptoms and Employment Status

50 Pages Posted: 24 Mar 2017

See all articles by Melisa Bubonya

Melisa Bubonya

University of Melbourne - Melbourne Institute of Applied Economic and Social Research

Deborah A. Cobb-Clark

School of Economics, University of Sydney; IZA Institute of Labor Economics

David C. Ribar

University of Melbourne

Multiple version iconThere are 2 versions of this paper

Date Written: March 24, 2017

Abstract

This paper analyzes the bilateral relationship between depressive symptoms and employment status. We find that severe depressive symptoms are partially a consequence of economic inactivity. The incidence of depressive symptoms is higher if individuals have been out of a job for an extended period. Men’s mental health falls as they exit the labor force, while women’s worsens only after they have been out of the labor force for a period of time. Entering unemployment is also associated with a substantial deterioration in mental health, particularly for men. We also find that severe depressive symptoms, in turn, lead to economic inactivity. Individuals are less likely to be labor force participants or employed if they experience severe depressive symptoms. Men’s probability of being unemployed rises dramatically with the onset of depressive symptoms; women’s unemployment is increased by protracted depressive symptoms.

Keywords: Mental health, unemployment, labor market status, HILDA survey, depressive symptoms, depression

JEL Classification: J01, J64, I14

Suggested Citation

Bubonya, Melisa and Cobb-Clark, Deborah A. and Ribar, David C., The Bilateral Relationship between Depressive Symptoms and Employment Status (March 24, 2017). Melbourne Institute Working Paper No. 10/17. Available at SSRN: https://ssrn.com/abstract=2940076 or http://dx.doi.org/10.2139/ssrn.2940076

Melisa Bubonya (Contact Author)

University of Melbourne - Melbourne Institute of Applied Economic and Social Research ( email )

Level 5, FBE Building, 111 Barry Street
Parkville, 3010
Australia

Deborah A. Cobb-Clark

School of Economics, University of Sydney ( email )

606 Social Sciences Bldg. (A02)
The University of Sydney
Sydney, NSW 2006
Australia
61435061387 (Phone)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

David C. Ribar

University of Melbourne ( email )

+61 3 8344 2794 (Phone)

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