Individual Consequences of Job Loss and Unemployment

Scholars from several different fields have studied the individual consequences of job loss and unemployment since the beginning of the twentieth century. This chapter provides a review of some important results of this research with special emphasis on the effects of unemployment on mental health. Among the topics reviewed are the size and practical relevance of these effects and the question of causality (i.e., does job loss really cause distress or are people with distress symptoms more likely to lose their jobs and remain unemployed for a longer time?) Results of moderator variables are also reviewed, as well as those concerning coping mechanisms. Then theories concerning the question of why unemployment impairs mental health (mediating mechanisms) are described, along with empirical results. Finally, some selected research findings for other outcome dimensions, ranging from physical health to political attitudes, are reported. The chapter ends with a discussion of the practical consequences of the reviewed research findings and the identification of research gaps.