Does leaving school in an economic downturn impact access to employer-sponsored health insurance?

Abstract

Previous work documents that leaving school in an economic downturn persistently depresses career outcomes as measured by wages, earnings, and other markers of labor market success. In this study I test whether leaving school in an economic downturn influences access to employer-sponsored health insurance. Using a long panel of workers drawn from the National Longitudinal Survey of Youth 1979 Cohort, I model the likelihood that a worker has access to employer-sponsored health insurance from initial labor market entrance through mid-career. I address the potential endogeneity of time and location of school-leaving with instrumental variables. My results suggest that leaving school in an economic downturn lowers the probability of access to employer-sponsored health insurance and this disparity is statistically distinguishable from zero 18 years after school-leaving. JEL codes: I1; I12; J3

Differential effects of graduating during a recession across gender and race

“…9 This process follows Kahn (2010) and other existing studies using the NLSY79. 10 Some existing studies use sampling weights (Maclean 2014(Maclean , 2015, but others do not (Kahn 2010;Hershbein 2012;Speer 2015). Since the unemployment rate at entry is unlikely to be correlated with the sampling weights, using the sampling weights would not change the results much.…”

“…The unemployment rates at older ages are unlikely to be independent of the error term, since the business cycle conditions in the first few years after entry may affect subsequent wages for high school graduates. Maclean (2014Maclean ( , 2015 uses the same data and similar instrumental variables. The key assumption here is that the highest degree/diploma attained and the state of residence at age 14 are independent from the state unemployment rate in the year of predicted entry.…”

“…2 This instrument is used in existing studies using the NLSY79, such as Kahn (2010); Speer (2015); Maclean (2014);Maclean (2015); Maclean et al (2015). 3 Relatedly, Gregg (2001) examines the long-term effect on an individual's own experience of unemployment at youth and finds that the effect is weaker for women than that for men, using British data.…”

“…The cases of enrollment for up to two years in colleges after not being enrolled at least for a year and enrollment after the age of 30 are not considered. Maclean (2014Maclean ( , 2015. …”

State Health Insurance Mandates and Labor Market Outcomes: New Evidence on Old Questions

“…Supporting these hypotheses, there is ample evidence that adverse labor market conditions, typically measured by the unemployment rate, at labor market entrance have longrun effects on the earnings, access to ESI, job prestige, and labor supply of workers (Ellwood, 1982, Kahn, 2010, Oreopoulos et al, 2012, Maclean, 2014, Altonji et al, 2016, Genda et al, 2010. For instance, using longitudinal Canadian data, Oreopoulos et al (2012), find that male college graduates who enter the labor market during a recession experience an initial earnings loss of 9% which persists for 10 years.…”