Unemployment kills

Mass lay-offs are, literally, deadly according to this new paper (pdf):

We find that job displacement leads to a 15-20% increase in death rates during the following 20 years. If such increases were sustained beyond this period, they would imply a loss in life expectancy of about 1.5 years for a worker displaced at age 40. These results are robust to extensive controls for sorting and selection.

This isn't just because unemployment leads to worse mental health. It's because low and volatile wages do too. Nor is it a US peculiarity; the same thing seems true of Sweden.
This should dispose of the myth that class inequalities (pdf) in health are due simply to differences in education or IQ. Even in advanced capitalist economies, you pay a high price for being economically powerless. The macho management of men like "Chainsaw" Al Dunlap is murderous.
This suggests that one trade-off might be more acute than realized. On the one hand, corporate restructuring is sometimes necessary; without it, economies would stagnate. But on the other hand, the costs of that restructuring might be higher than supposed.

Comments

[dearieme]

If people really did internalise the truth that correlation need not imply cause, there wouldn't be much left for "social scientists" to whinge about, would there?

[john b]

If people read the linked papers before moaning about them, they'd find that their criticisms were nonsensical (the piece in question follows *specific groups of people over time through job loss*, rather than taking 'as #y rises so #x rises').

[dearieme]

Post hoc ergo propter hoc is a fallacy too.

[Marcin Tustin]

Perhaps a citizens' basic income would reduce wage volatility?

[Matt Munro]

I'm not sure that you've disproved the "myth" that class inequalities (and consequent differences in health) are due to IQ. Stupid people earn less than clever people and have poorer health. The correlation could be
low iq = crap job, and crap job = poor wages and poor wages = poor health. Or it could be unconnected, for example
crap job + lottery win (still) = poor health. In other words there may still be a link between health and IQ, even if income is unaffected by IQ.
Poorer people are more likely to smoke, binge drink, eat unhealthy food and not exercise. The question is do they adopt healthier habits if they have incomes which are comparable with their cleverer cohorts, even without the their IQ ?
What this study shows (if anything) is that if intelligent people are made poor, even temporarily, it affects their health. In effect they get a sudden dose of poverty, the stress of which is hazardous to health, whereas poor people have that dose of poverty, and that stress, pretty much all of their lives. You could argue that being unused to poverty, and not expecting it, makes the unexpectedly poor less able to deal with it.