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Unemployment in the Great Recession: A Comparison of Germany, Canada, and the United States

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  • Florian Hoffmann
  • Thomas Lemieux

Abstract

This paper looks at the surprisingly different labor market performance of the United States, Canada, Germany, and several other OECD countries during and after the Great Recession of 2008-9. A first important finding is that the large employment swings in the construction sector linked to the boom and bust in US housing markets is an important factor behind the different labor market performances of the three countries. We also find that cross-country differences among OECD countries are consistent with a conventional Okun relationship linking gross domestic product growth to employment performance.

Suggested Citation

  • Florian Hoffmann & Thomas Lemieux, 2016. "Unemployment in the Great Recession: A Comparison of Germany, Canada, and the United States," Journal of Labor Economics, University of Chicago Press, vol. 34(S1), pages 95-139.
    • Handle: RePEc:ucp:jlabec:doi:10.1086/682424
    DOI: 10.1086/682424
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    Cited by:

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    2. Ha Nguyen & Shawheen Rezaei & Divya Agarwal, 2022. "The great recession and job loss spillovers: impact of tradable employment shocks on supporting services," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 68(3), pages 789-815, June.
    3. Jonathan Eaton & Samuel Kortum & Brent Neiman & John Romalis, 2016. "Trade and the Global Recession," American Economic Review, American Economic Association, vol. 106(11), pages 3401-3438, November.
    4. Clemens, Jeffrey & Wither, Michael, 2019. "The minimum wage and the Great Recession: Evidence of effects on the employment and income trajectories of low-skilled workers," Journal of Public Economics, Elsevier, vol. 170(C), pages 53-67.
    5. Clemens, Jeffrey & Wither, Michael, 2014. "Just the Facts: Demographic and Cross-Country Dimensions of the Employment Slump," MPRA Paper 60228, University Library of Munich, Germany.
    6. Moritz Drechsel‐Grau & Andreas Peichl & Kai D. Schmid & Johannes F. Schmieder & Hannes Walz & Stefanie Wolter, 2022. "Inequality and income dynamics in Germany," Quantitative Economics, Econometric Society, vol. 13(4), pages 1593-1635, November.
    7. Dilmaghani, Maryam & Dean, Jason, 2020. "Sexual orientation and homeownership in Canada," Journal of Housing Economics, Elsevier, vol. 49(C).
    8. Heinrichs, Katrin, 2016. "German Consumption Inequality. An evaluation with a focus on the financial crisis," VfS Annual Conference 2016 (Augsburg): Demographic Change 145891, Verein für Socialpolitik / German Economic Association.
    9. Derek Messacar, 2022. "Community attachment, job loss and regional labour mobility in Canada: Evidence from the Great Recession," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 55(3), pages 1404-1430, August.
    10. Görg, Holger & Henze, Philipp & Jienwatcharamongkhol, Viroj & Kopasker, Daniel & Molana, Hassan & Montagna, Catia & Sjöholm, Fredrik, 2017. "Firm size distribution and employment fluctuations: Theory and evidence," Research in Economics, Elsevier, vol. 71(4), pages 690-703.
    11. Sergei Guriev & Biagio Speciale & Michele Tuccio, 2019. "How do Regulated and Unregulated Labor Markets Respond to Shocks? Evidence from Immigrants During the Great Recession," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 35(1), pages 37-76.
    12. Kaiser, Micha & Reutter, Mirjam & Sousa-Poza, Alfonso & Strohmaier, Kristina, 2018. "Smoking and local unemployment: Evidence from Germany," Economics & Human Biology, Elsevier, vol. 29(C), pages 138-147.
    13. Hian Teck Hoon & Margarita Katsimi & Gylfi Zoega, 2023. "Investment and the long swings of unemployment," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 31(3), pages 611-632, July.
    14. Hian Teck Hoon & Margarita Katsimi & Gylfi Zoega, 2018. "Investment, Current Account, and the Long Swings of Unemployment," Birkbeck Working Papers in Economics and Finance 1810, Birkbeck, Department of Economics, Mathematics & Statistics.
    15. Margarita Katsimi & Gylfi Zoega, 2017. "The Modigliani Puzzle Revisited: A Note," CESifo Working Paper Series 6833, CESifo.
    16. Bas Weel, 2015. "Unemployment: The Great Recession and Beyond," De Economist, Springer, vol. 163(4), pages 405-413, December.
    17. Watson, Philip & Deller, Steven, 2017. "Economic diversity, unemployment and the Great Recession," The Quarterly Review of Economics and Finance, Elsevier, vol. 64(C), pages 1-11.
    18. Julio G. Fournier Gabela & Luis Sarmiento, 2020. "Kurzarbeit and Natural Disasters: How Effective Are Short-Time Working Allowances in Avoiding Unemployment?," Discussion Papers of DIW Berlin 1909, DIW Berlin, German Institute for Economic Research.
    19. Burda Michael C. & Seele Stefanie, 2017. "Das deutsche Arbeitsmarktwunder: Eine Bilanz," Perspektiven der Wirtschaftspolitik, De Gruyter, vol. 18(3), pages 179-204, October.
    20. Roberta Capello & Andrea Caragliu, 2021. "Merging macroeconomic and territorial determinants of regional growth: the MASST4 model," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 66(1), pages 19-56, February.
    21. Carl Singleton, 2018. "Long‐Term Unemployment and the Great Recession: Evidence from UK Stocks and Flows," Scottish Journal of Political Economy, Scottish Economic Society, vol. 65(2), pages 105-126, May.
    22. repec:hum:wpaper:sfb649dp2017-022 is not listed on IDEAS
    23. Rivers, Nicholas & Schaufele, Brandon, 2015. "Salience of carbon taxes in the gasoline market," Journal of Environmental Economics and Management, Elsevier, vol. 74(C), pages 23-36.
    24. Glancy, David, 2021. "Housing bust, bank lending & employment: Evidence from multimarket banks," Journal of Banking & Finance, Elsevier, vol. 127(C).
    25. Duvnjak, Kristina & Bogdan, Sinisa & Baresa, Suzana, 2017. "Role Of Attractiveness Factors Of The Oecd Countries In Immigrations," UTMS Journal of Economics, University of Tourism and Management, Skopje, Macedonia, vol. 8(3), pages 307-317.

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    More about this item

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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