Laid-off workers face increased premature death risk: study
Last Updated: Thursday, December 6, 2007 | 5:05 PM ET
CBC News
A new paper by two American economists suggests people who lose their jobs may be at risk of premature death.
Economists tracked the lives of more than 20,000 workers in Pennsylvania over a 30-year period, including 7,000 employees who lost their jobs in mass layoffs.
They looked at the number of deaths for these laid-off workers up until 20 years after job loss and compared their mortality to that of similar employees who did not lose their job.
"The bottom line is that large mass layoffs that lead to large earnings losses will increase mortality of the affected workers 10 to 20 per cent a year. That leads to a loss of life expectancy of one to two years," said Till von Wachter, a labour economist at Columbia University, who conducted the study with Daniel Sullivan, an economist with the U.S. Federal Reserve.
The mortality risk was calculated using a complex mathematical formula that factored in the impact of a job loss on a person's earnings, their career stability and the health status of the individual.
An examination of death statistics showed a 15 to 20 per cent increase in mortality in the 20 years after the layoff.
"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," reads the paper.
The National Bureau of Economic Research white paper was published Nov. 30.
Von Wachter is convinced the risk of dying is most pronounced in those in their late 30s and early 40s.
"Younger workers experience the negative consequences of mass-layoffs on their careers for much longer periods of time," reads the study.
"It seems to be that the exposure to chronic stress is what really matters here," he said.
The authors cite earlier studies that make the connection between job loss and strokes and heart attacks — particularly in older workers.
Peter Kuhn, a Canadian who now teaches economics at the University of California, calls the U.S. study a breakthrough — and is convinced its findings apply to the Canadian economy as well.
"You might dispute it if someone's measuring your happiness or your psychological well-being," Kuhn said. "But death statistics are very hard [to dispute]."
Roughly one million Canadians are permanently laid off from their jobs every year.
