The Effect of Job Loss on Self-Rated Health and Health Behavior

Abstract

The purpose of this study was to analyze the effects of job loss on self-rated health and health behavior. Unemployment due to plant closure was defined as involuntary job loss, and the effect of exogenous job loss on self-rated health and health behavior was analyzed using a fixed effect model to control unobservable individual characteristics, and additional analysis was conducted by length of service and gender. The results of this study showed that job loss had a negative effect on self-rated health. In particular, the negative impact of unemployment was relatively stronger for men and long-term workers, confirming that the effect was heterogeneous depending on the attachment to the labor market. On the other hand, re-employment was found to had played a role in alleviating the deterioration of health due to job loss. This study also found that job loss did not significantly affect the probability of smoking, but played a role in significantly lowering the probability of drinking.