Macroeconomic Shocks, Job Security, and Health

Abstract

How do exogenous changes in the macroeconomic environmen t affect workers' perceived job security, and consequently, their mental and physical health? To answer this question, we exploit variation in world commodity prices over the period 2001-17 and analyse panel data that includes detailed classifications of mining workers. We find that commodity price increases cause increases in perceived job security, which in turn, significantly and substantively improve the mental health of workers. In contrast, we find no effects on physical health. Our results imply that the estimated welfare costs of recessions are much larger when the effects of job insecurity, and not only unemployment, are considered.

Economic crisis and mental health during the COVID-19 pandemic in Japan

“…The findings of past studies suggest that mental health conditions tend to deteriorate in times of economic downturns (e.g., Bradford and Lastrapes, 2014 ; Barr et al, 2015 ; Johnston et al, 2020 ; Wang and Fattore, 2020 ). Thus, the economic crisis induced by the COVID-19 pandemic can have a serious impact on population mental health.…”

The Health Externalities of Downsizing

“…Often they focus on different types of stress, in particular shocks during childhood, such as famines (Lindeboom, Portrait & van den Berg 2010, van den Berg, Pinger & Schoch 2016 or the death of a family member (Persson & Rossin-Slater 2018, Schmidpeter 2019. Another strand of the literature interprets bad economic conditions or import competition as stress and estimates effects on health, both during childhood (van den Berg, Lindeboom & Portrait 2006) and adulthood (e.g., Adda & Fawaz 2020, Johnston et al 2020, Kronenberg & Boehnke 2019, Pierce & Schott 2020, Ruhm 2000. We also speak to the literature showing that unemployment leads to increases in 'deaths of despair' (i.e., deaths due to drug and alcohol abuse and suicides) using aggregate data for the US (e.g., Case & Deaton 2017, Hollingsworth et al 2017.…”

“…The management literature identifies the fear of losing one's own job as the main source of stress in workers during downsizing periods (e.g., Klehe et al 2011), and there is some empirical evidence that job insecurity can affect mental health (Cottini & Ghinetti 2018, Johnston et al 2020, Reichert & Tauchmann 2017.…”

New(spaper) evidence of a reduction in suicide mentions during the 19th century US gold rush

“…The second stream analyzes how changes in a measure of the aggregate economy relate to changes in an aggregate measure of health (Fishback et al, 2007;Gerdtham & Ruhm, 2006;Gonzalez & Quast, 2011;Miller et al, 2009;Ruhm, 2000Ruhm, , 2015Ruhm, , 2016Stevens et al, 2015). Both streams are connected by Johnston et al (2020). They link changes in the world commodity prices of several commodities to Australian mining workers' perceived job security and mental health.…”