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No Youth Left behind? The Long‐Term Impact of Displacement on Young Workers
Author(s) -
Hardoy Inés,
Schøne Pål
Publication year - 2013
Publication title -
kyklos
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.766
H-Index - 58
eISSN - 1467-6435
pISSN - 0023-5962
DOI - 10.1111/kykl.12025
Subject(s) - unemployment , economics , displacement (psychology) , displaced workers , wage , labour economics , demographic economics , term (time) , financial crisis , youth unemployment , work (physics) , psychology , economic growth , macroeconomics , mechanical engineering , physics , quantum mechanics , engineering , psychotherapist
Summary We investigate short‐ and long‐term impacts on labour market outcomes of experiencing a displacement for young workers. The period under study is 2000–2009. The end of the observation period is characterised by a shrinking labour market, coinciding with the start of the financial crisis. The main merit of the study is the inclusion of a wide battery of dependent variables. In general we find sizeable short‐term effect on both unemployment and wage‐employment. Furthermore, the results indicate that displacement has a long‐term negative effect on wage employment. Part of this pattern seems to be masked by an increased likelihood of self‐employment. A positive effect on self‐employment is desirable from a policy perspective. Finally, among those who are employed in the final observation year, we find a small negative effect of displacement on hourly wages. This is solely explained by the foregone work experience of the displaced workers in the years after displacement.