Child Social Maladjustment and Adult Employment Dynamics

This paper investigates the effect of social maladjustment at age 11 on adult employment probability. Social maladjustment is measured according to the British Social Adjustment Guide score provided by the National Child Development Study that also provides information on cohort-members both in childhood and adulthood, including current employment status and past working history. The econometric method consists in a dynamic probit model with unobserved heterogeneity accounting for true state dependence and initial conditions problem. Consistently with the previous literature, we find that social maladjustment during childhood determines a lower employment probability in adulthood. This result holds also after controlling for true state dependence and past working history. Interestingly, the adult employment probability of socially maladjusted children is prone to greater variability according to life experiences than that of socially adjusted children. We find that being employed in the previous period, education, young-adulthood working experiences and, for females, early working experiences increases the adult employment probability for all cohort-members. However the positive effect is stronger for socially maladjusted children and, overall, investment in higher education seems to be relevant. This suggests that interventions during life development for socially maladjusted children could be important to reduce inequality in adult employment probability.