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Couples' Labour Supply Responses to Job Loss: Boom and Recession Compared

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Author Info

  • Bryan, Mark L.

    ()
    (University of Essex)

  • Longhi, Simonetta

    ()
    (ISER, University of Essex)

Abstract

We examine how couples' labour supply behaviour in the UK responds to a job loss by one partner, using the Labour Force Survey to compare the period of growth of 1995-2007 to the Great Recession and its aftermath of 2008-11. In single earner couples during the recession, both men and women substantially increased their job search activity following a partner's job loss, while the increase in search during the boom was smaller (and non-existent for men). However, the increase in job search during recession did not appear to translate into more success in finding work for either men or women. Among dual earner couples, we find little evidence that individuals searched for alternative jobs or tried to increase their hours if their partner lost their job, except that women working part-time were more likely to start looking for another job. Both men and women were more likely to quit their job voluntarily if their partner lost their job, but the recession seems to have made people more cautious about voluntarily quitting their job. We find little evidence that people react in advance of job losses, suggesting that unemployment typically comes as a surprise.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7775.

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Length: 28 pages
Date of creation: Nov 2013
Date of revision:
Handle: RePEc:iza:izadps:dp7775

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Keywords: added-worker effect; recession; employment; household labour supply;

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  1. Layard, R & Barton, M & Zabalza, A, 1980. "Married Women's Participation and Hours," Economica, London School of Economics and Political Science, vol. 47(185), pages 51-72, February.
  2. Kamath, Kishore & Reinold, Kate & Nielsen, Mette & Radia, Amar, 2011. "The financial position of British households: evidence from the 2011 NMG Consulting survey," Bank of England Quarterly Bulletin, Bank of England, vol. 51(4), pages 305-318.
  3. Dominique Goux & Eric Maurin & Barbara Petrongolo, 2011. "Worktime Regulations and Spousal Labor Supply," CEP Discussion Papers dp1096, Centre for Economic Performance, LSE.
  4. Lundberg, Shelly, 1985. "The Added Worker Effect," Journal of Labor Economics, University of Chicago Press, vol. 3(1), pages 11-37, January.
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  6. Benito, Andrew & Saleheen, Jumana, 2011. "Labour supply as a buffer: evidence from UK households," Bank of England working papers 426, Bank of England.
  7. Cullen, Julie Berry & Gruber, Jonathan, 2000. "Does Unemployment Insurance Crowd Out Spousal Labor Supply?," Journal of Labor Economics, University of Chicago Press, vol. 18(3), pages 546-72, July.
  8. Maloney, Tim, 1991. "Unobserved Variables and the Elusive Added Worker Effect," Economica, London School of Economics and Political Science, vol. 58(230), pages 173-87, May.
  9. Spletzer, James R, 1997. "Reexamining the Added Worker Effect," Economic Inquiry, Western Economic Association International, vol. 35(2), pages 417-27, April.
  10. Miki Kohara, 2010. "The response of Japanese wives’ labor supply to husbands’ job loss," Journal of Population Economics, Springer, vol. 23(4), pages 1133-1149, September.
  11. Paul Bingley & Ian Walker, 1996. "Household Unemployment and the Labour Supply of Married Women," Keele Department of Economics Discussion Papers (1995-2001) 96/20, Department of Economics, Keele University.
  12. Orazio Attanasio & Hamish Low & Virginia Sánchez-Marcos, 2005. "Female Labor Supply As Insurance Against Idiosyncratic Risk," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 755-764, 04/05.
  13. Blau, David M, 1998. "Labor Force Dynamics of Older Married Couples," Journal of Labor Economics, University of Chicago Press, vol. 16(3), pages 595-629, July.
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Cited by:
  1. Stefanie Hoherz, 2014. "Maternity Leave in the Context of Couples: The Impact of Both Partners' Characteristics and Employment Experiences on Mothers' Re-entry into the Labour Market," SOEPpapers on Multidisciplinary Panel Data Research 647, DIW Berlin, The German Socio-Economic Panel (SOEP).
  2. Julia Bredtmann & Sebastian Otten & Christian Rulff, 2014. "Husband’s Unemployment and Wife’s Labor Supply – The Added Worker Effect across Europe," Economics Working Papers 2014-13, School of Economics and Management, University of Aarhus.

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