19 June 2014, Oxford, UK: A new study published online in the International Journal of Epidemiology (IJE) today shows that while job loss is associated with depressive symptoms in both the USA and Europe, the effects of job loss due to plant closure are much stronger in American workers as compared with European workers.
The 'Great Recession' of 2008 caused significant job losses in both Europe and the USA, with particularly strong consequences for older workers. Among persons aged 50-64, unemployment rates rose from 3.1% to 7.3% in the USA, and from 5.4% to 6.15% in the EU-15 countries. Resultant income losses may have devastating consequences for the retirement plans of older workers, increase their risk of poverty in old age, and render them more vulnerable to mental illness. Prior evidence has already suggested that job loss among older workers is associated with poorer health, increased substance use, and increased depression.
This new study, led by Carlos Riumallo-Herl, is the first to compare how these associations differ across countries. The researchers used harmonized data on 38,356 individuals from the Health and Retirement Survery (HRS) and the Survey of Health, Ageing and Retirement in Europe (SHARE) covering the years 2004-2010. Surveys were carried out via questionnaire face-to-face in Europe and over the phone in America, and covered 13 European countries and the USA. The European countries covered were Austria, Belgium, Czech Republic, Denmark, France, Germany, Greece, Italy, The Netherlands, Poland, Spain, Sweden, and Switzerland.
At each interview, individuals were classified into four broad categories: employed; unemployed and looking for work; retired; or disabled. Data were also collected to distinguish reasons for job loss: due to the worker's firm or plant closing down; due to redundancy; or job loss for another reason (e.g. mutual agreement or the end of a temporary contract). The individuals from SHARE were rated on the Euro-Depression scale (EURO-D), while American respondents were rated on the short version of the Center for Epidemiologic Studies Depression Scale (CESD-D).
The results showed that overall job loss was associated with a 4.8% increase in depression scores in the USA, and a 3.4% increase in Europe. However, when job loss due to plant closure was looked at separately, depressive symptom scores increased by 28.2% in the USA as compared to 7.5% in Europe.
The role of wealth also differed across the two regions. Carlos Riumallo-Herl says:
"In the USA, the impact of job loss is significantly stronger for those with little or no wealth than for wealthier individuals and the impact of job loss due to plant closure was stronger than in Europe. In contrast, we observed significant but weaker effects of job loss on depressive symptoms in Europe, which were not modified by pre-existing levels of wealth.
These findings raise questions about the potential role of safety net programmes in Europe in mitigating the impact of job loss on depression among workers with little or no savings. A potential hypothesis is that, albeit at the cost of higher incentives to leave the labour market early, the greater generosity of the European benefit system translates into more financial security and less depletion of individual wealth before retirement.
The stronger effect of job loss on depression in poor Americans compared with poor Europeans should prompt further research on the potential role of specific social protection programmes in buffering the impact of job loss among less wealthy workers and their families."
This comment is echoed by Dr Lisa F. Berkman, Thomas D. Cabot Professor of Public Policy and of Epidemiology, Harvard School of Public Health, in her commentary on the paper, which is also published online in IJE today:
"Job loss is a profoundly disruptive experience. As economies become more globalized and job transitions more common, the identification and implementation of policies that enable both societal as well as personal resilience will becomes increasingly important. This new piece of research points us in the right direction."