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The Effect of Separation on Poverty and Employment

Author

Listed:
  • Broadway, Barbara

    (Melbourne Institute of Applied Economic and Social Research)

  • Kalb, Guyonne

    (University of Melbourne)

Abstract

Using 2001–2021 HILDA survey data, this paper estimates how separation or divorce affects poverty and employment trajectories over five years after the event. A difference-in-differences approach compares separated individuals with couples who stayed together, accounting for recent and long-term labour market history prior to separation. Women with preschool children face a 19.9 percentage point higher poverty risk in the first year, which fades within three years. Women with older or no children experience smaller but longer-lasting poverty increases. Pre-separation employment strongly moderates effects: non-employed women face much higher poverty risks than employed women who have similar poverty risks to men. Men’s poverty impacts are smaller and shorter-lived. Separation barely changes women’s employment but slightly reduces men’s employment, especially those with preschool children.

Suggested Citation

  • Broadway, Barbara & Kalb, Guyonne, 2025. "The Effect of Separation on Poverty and Employment," IZA Discussion Papers 18343, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp18343
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    Keywords

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    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination

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