Will the Jobs Bill Impact Population Health?

Originally posted 10/26/2010

The last week has seen much attention devoted to the issue of jobs and unemployment in our country. Presidential elections often hinge on the state of the economy and the persistence of high unemployment rates will likely play a greater role in 2012 than in previous periods. While a growing literature shows that displaced workers (defined as individuals who lose their jobs as part of plant closings, mass layoffs, and other firm-level employment reductions) tend to experience significant long-term earnings losses as well as decreased job stability, lower employment rates, earlier retirement, lower personal spending, and decreased health insurance coverage.

In addition to these primarily economic effects, there are likely to be health effects as well. Unemployment (measured as the percent of the population age 16 and over that is unemployed but seeking work) is one of seven key measures in the County Health Rankings’ Social and Economic Factors, but is only briefly mentioned in Healthy People 2020’s new section on the Social Determinants of Health.

An extensive literature demonstrates the association of unemployment with an increased likelihood of morbidity and mortality. In a 2009 review, Bambra summarized:

There are clear relationships between unemployment and increased risk of poor mental health and parasuicide, higher rates of all cause and specific causes of mortality, self-reported health and limiting long-term illness and, in some studies, a higher prevalence of risky health behaviours, including problematic alcohol use and smoking. The negative health experiences of unemployment are not limited to the unemployed only but also extend to families and the wider community…..links between unemployment and poorer health have conventionally been explained through two inter-related concepts: the material consequences of unemployment (e.g., wage loss and resulting changes in access to essential goods and services) and the psychosocial effects of unemployment (e.g., stigma, isolation and loss of self-worth).

In the year after displacement, Sullivan and von Wachter (2009) found mortality rates among long-tenured employees were 50%–100% higher than would otherwise have been expected. This effect on mortality hazards declined sharply over time, but persisted. Even twenty years after displacement, the authors estimated a 10%–15% increase in annual death hazards. If such increases were sustained indefinitely, they would imply a loss in life expectancy of 1.0–1.5 years for a worker displaced at age forty. Similarly, Bartley and Ferrie (2010)  found unemployment elevated the risk of premature death by 57% among men ages 44-54.    

But what comes first – unemployment or poor health? I do not usually focus on issues of research methodology in this blog, but the unemployment and health relationship is a good place to discuss reverse causality, since it features prominently in this literature and is of critical policy importance. In the unemployment relationship, not only are the unemployed likely to be less healthy, but it is also intuitive to expect that less healthy individuals are more likely to be unemployed because they are unhealthy and, therefore, less productive employees.

But sorting out these conflicting causal pathways is difficult. Lundin and colleagues (2010) estimated that 49% of the association between unemployment and poor health was due to poor health resulting in unemployment. Of course, context plays a major role. In Germany, where citizens have access to generous unemployment benefits, long entitlement durations, and universal health insurance, health status seems to drive employment status rather than vice-versa (Schmitz, 2011).

While researchers and policymakers need to be aware of such concerns, the U.S. evidence such as that of Sullivan cited above which control for reverse causality certainly suggest that we should consider job loss and unemployment a significant determinant of population health. While impact on income will likely remain the dominant policy concern, we would do well to keep in mind the impact on health and related worker productivity as the costs and benefits of employment policy are debated in the coming months and years.

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