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Does job insecurity deteriorate health?

Eve Caroli1, Mathilde Godard2

  • 1LEDa-LEGOS, Paris School of Economics and IZA, University Paris-Dauphine.

Health Economics
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Summary

Job insecurity, the fear of job loss, negatively impacts men's health, particularly causing headaches, eyestrain, and skin issues. This finding holds even when accounting for endogeneity in job security perceptions.

Keywords:
healthinstrumental variablesjob insecurity

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Area of Science:

  • Occupational Health
  • Public Health
  • Socioeconomic Determinants of Health

Background:

  • Perceived job insecurity is a significant stressor with potential health consequences.
  • Previous research often struggles to establish causality due to endogeneity.
  • Understanding the specific health impacts of job insecurity is crucial for public health interventions.

Purpose of the Study:

  • To estimate the causal effect of perceived job insecurity on various health outcomes in European men.
  • To address the endogeneity of job insecurity using an instrumental variable approach.
  • To identify specific health conditions linked to the fear of involuntary job loss.

Main Methods:

  • Utilized cross-country data from the 2010 European Working Conditions Survey.
  • Employed an original instrumental variable strategy based on national and industry-level employment protection legislation.
  • Accounted for potential weak-instrument issues in the econometric model.

Main Results:

  • Unadjusted analyses suggested job insecurity negatively affected most health outcomes.
  • Instrumental variable analysis confirmed a significant detrimental effect on specific health issues: headaches, eyestrain, and skin problems.
  • The impact of job insecurity on other health variables was not statistically significant at conventional levels.

Conclusions:

  • Perceived job insecurity has a causal, albeit specific, negative impact on men's health.
  • Employment protection legislation can serve as an instrumental variable for job security perceptions.
  • Targeted interventions addressing stress related to job insecurity may improve specific health outcomes like headaches and skin conditions.