The effect of separation on poverty and employment

Barbara Broadway () and Guyonne Kalb ()
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Barbara Broadway: Melbourne Institute of Applied Economic and Social Research, https://findanexpert.unimelb.edu.au/profile/353961-barbara-broadway
Guyonne Kalb: Melbourne Institute of Applied Economic and Social Research, https://findanexpert.unimelb.edu.au/profile/6582-guyonne-kalb

Melbourne Institute Working Paper Series from Melbourne Institute of Applied Economic and Social Research, The 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.

Keywords: relationship breakdown; poverty; economic autonomy (search for similar items in EconPapers)
JEL-codes: I32 J12 J16 (search for similar items in EconPapers)
Pages: 78pp
Date: 2025-11
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Persistent link: https://EconPapers.repec.org/RePEc:iae:iaewps:wp2025n17

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