RT Journal Article
SR Electronic
T1 The Changing Consequences of Unemployment for Household Finances
JF RSF: The Russell Sage Foundation Journal of the Social Sciences
FD Russell Sage Foundation
SP 202
OP 221
DO 10.7758/RSF.2017.3.3.09
VO 3
IS 3
A1 William T. Dickens
A1 Robert K. Triest
A1 Rachel B. Sederberg
YR 2017
UL http://www.rsfjournal.org/content/3/3/202.abstract
AB In this article we present new evidence that the capacity of households to cover earnings lost during spells of unemployment through a combination of drawing down of wealth and receipt of unemployment insurance and other transfer payments is very limited and has deteriorated since the 1980s. Since 2006, most households have not had nearly enough financial wealth to smooth their consumption over more than a very short spell of unemployment. Individuals experiencing involuntary job loss also tend to experience substantial earnings reductions upon reemployment, resulting in longer-term deterioration in household finances. Wealth inadequacy to cover lost earnings and the earnings reduction upon reemployment are both especially acute in long unemployment spells, such as those that were prevalent in the aftermath of the Great Recession.