The psychological scars of unemployment
Human beings are adaptable. They can get used to the loss of a limb or a long illness. But one thing they don’t get used to is unemployment:
Most people adapt surprisingly well to changes in their lives. Even after tragic events such as the death of a family member or a chronic disease, they restore their former wellbeing, if not always completely (Clark et al 2008). There is one event, though, for which this appears not to be true – unemployment. Compared with other negative experiences, the life satisfaction of the unemployed does not restore itself even after having been unemployed for a long time.
That’s according to Clemens Hetschko, Andreas Knabe and Ronnie Schöb in a new paper for the policy site VoxEU. The researchers posit that this is because the unemployed experience a “permanent loss of identity”: They continue to consider themselves “able to work” — i.e. they should be employed — so they don’t accept their unemployed status as their authentic identity.
In fact, the researchers found when the long-term unemployed decide to enter retirement — which changes their social status but nothing else about their situation — their sense of well-being shoots up, while those who are employed don’t experience the same effect. This suggests just how much the psychological burden — and perhaps, the social stigma — of being unemployed is weighing on the minds of those out of work for long periods of time: