Hannes Schwandt and Till von Wachter of the Northwestern University and University of California respectively have written a 1,500 word summary of the current academic understanding of some of the negative effects on those entering the labor market in difficult times.
In the latest edition of the IMF’s Finance and Development bulletin they highlight data from the U.S. but stress this is only because that’s where the best data is to be found.
However, there can be no doubt this is a global issue and one that’s likely to wallop the young in poorer countries harder than the better off.
You can dispatch the read in 10-minutes and if you have children it might be the most valuable ten-minute read of their and your life. In the briefest of brief nutshells here are the main points:
- Graduates entering a recessionary labor market are likely to suffer a 10~15-year lower-earnings penalty
- The effect is also observed for high schoolers and both groups may go on to suffer from low esteem, commit more crime and have lower trust in their government than peers from more fortunate cohorts
- Poorer health outcomes, in part a consequence of the above, can feed back into lifetime outcomes including premature mortality
- The effects of this misfortune may, for many, never fully disappear
That longer read is here The Long Shadow
Er, Happy Sunday?