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The Wounds That Do Not Heal. The Life-time Scar of Youth Unemployment

Author

Listed:
  • De Fraja, Gianni
  • Lemos, Sara
  • Rockey, James

Abstract

This paper finds that unemployment shocks affect young workers for the rest of their lives. This scar of youth unemployment is concentrated in the first few years after entry in the labour market: one month of unemployment at age 18-20 cause a permanent income loss of 2%. However, unemployment after that age has no long term effect.

Suggested Citation

  • De Fraja, Gianni & Lemos, Sara & Rockey, James, 2017. "The Wounds That Do Not Heal. The Life-time Scar of Youth Unemployment," CEPR Discussion Papers 11852, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:11852
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    More about this item

    Keywords

    Lifetime earnings; Scarring effect.; youth unemployment;

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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