The Long-Term Labor Market Effects of Parental Unemployment

Bernhard Schmidpeter
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Bernhard Schmidpeter: RWI – Leibniz Institute for Economic Research; Christian Doppler Laboratory Aging, Health and the Labor Market, JKU Linz; IZA, Institute for the Study of Labor, Bonn

No 20-322, Upjohn Working Papers from W.E. Upjohn Institute for Employment Research

Abstract: I investigate the impact of parental unemployment on children’s educational attainment and long-run labor market outcomes in Austria. I find that parental unemployment shortly before an important educational decision by parents for their children lowers a child’s probability of holding a university degree by more than 5 percentage points. I do not find that income is affected at the beginning of a child’s labor market career along the distribution, but I find a gradual deterioration later on. A substantial share of these long-term losses can be explained by the lower parental investment decision. My results emphasize the intergenerational and long-lasting consequences of parental unemployment.

Keywords: parental unemployment; intergenerational effects; long-term effects; unemployment; wage loss; decomposition (search for similar items in EconPapers)
JEL-codes: C21 I23 J13 J31 J64 (search for similar items in EconPapers)
Date: 2020-08
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Citations: View citations in EconPapers (3)

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