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November 21, 2016

Job insecurity is bad for our health

Opinion image

We live in uncertain times. Eight years on from the Great Recession of 2008, and still one in ten workers across Europe is unemployed—that’s 21 million people. Global growth is faltering and in Europe the “Brexit” decision threatens a prolonged period of adjustment at minimum. It is likely that there will be low growth in Britain for a while, if not a renewed recession, and repercussions elsewhere. What does this uncertainty mean for our well-being and for the demands placed on health systems? Can we do anything to alleviate the potential health fall-out?

For some time now we have known that health can be impaired through unemployment. It can lead to a loss of identity, because many see their job as part of what they are—even if they may sometimes curse it on a Monday morning when facing a long week’s hard work ahead. And of course unemployment also means a loss of livelihood.

But the problem of uncertainty goes well beyond just those people unlucky enough to lose their job. Many more live their lives in fear of losing their job. Evidence comes, for example, from the European Survey of Working Conditions. Across Europe in 2015, 16% of those in employment reported that they might lose their job in the ensuing six months—that’s 33 million workers. The proportion who feel like this goes up when unemployment rises, and what people expect generally captures the real risks fairly well. The fear acts as a stressor on the human body, with consequent physical and mental effects. Just as with unemployment itself, the fear of job loss goes beyond the very real financial risks for hard-up families.

So what do we know about the effects of this job insecurity on our health in practice? Recent studies across Europe have shown that people in insecure jobs are indeed less healthy. The most convincing ones look at situations where insecurity has increased and workers can’t avoid it. One such study covering many countries found that job insecurity has substantial effects on headaches, eyestrains, and skin problems and on self-reported ill-health. Another study covering Australia, Canada, Switzerland, and the UK found that, when people moved from a secure to an insecure job, they suffered a substantial increase in mental distress. These findings reveal only part of the problem, because they do not begin to touch on the knock-on effects on family members.

I do not believe that we should have to live with macroeconomic uncertainty. Decisions that led to the Great Recession and, later to the British public voting for Brexit, were misguided and avoidable. But, given the situation we are in now, what can be done to minimize the health fall-out from job insecurity?

One thing we do know is that the prospect of regaining employment is very important for health. Policymakers can alleviate demands on the health system through strategies to encourage a decent flow of job opportunities—making sure labor markets are open, enabling retraining opportunities, and stimulating macroeconomic demand. But the evidence also shows that employers can help. Ensuring that their employees have systems of social support, and can participate to a degree in decision-making, are important ways in which they can counter the ill effects of insecurity.

Related article:
Health effects of job insecurity, by Francis Green

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We recognize that IZA World of Labor articles may prompt discussion and possibly controversy. Opinion pieces, such as the one above, capture ideas and debates concisely, and anchor them with real-world examples. Opinions stated here do not necessarily reflect those of the IZA.