Short- and long-term health effects of job insecurity. Fixed effects panel analysis of German data

Previous research has linked job insecurity to health deterioration. The risk accumulation model suggests that health effects of job insecurity may persist even after job security is restored, yet long-term empirical analyses are scarce. Our study evaluates the long-term effects of accumulated exposures to affective job insecurity on mental and physical health among the working-age population in Germany.

Using data from the German Socioeconomic Panel (12 624 individuals; 84 219 observations), we applied panel regression models with individual fixed effects to assess short- and long-term health changes associated with affective job insecurity. Job insecurity was measured by respondents' worries about job security. Mental and physical health was recorded with the SF-12 scale.

Job insecurity correlated with short-term worsening in mental and physical health. However, after job insecurity ceased, health recovery was incomplete resulting in a long-term health deterioration. The long-term effects were larger among respondents who accumulated more instances of job insecurity, and showed a similar pattern for mental and physical health. An additional analysis documented stronger health effects of job insecurity among lower educated persons.

Our study is one of the first to empirically demonstrate the negative long-term health effects of job insecurity. Our findings for a well-protected labor market like Germany's, suggest that the health risks associated with job insecurity may be substantial and potentially underestimated by studies that focus solely on short-term effects.