Publications
WP-EC 2014-04
Wellbeing at work and the Great Recession: The effect of others' unemployment
Borra, C. and Gómez, F.
Year of publication: 2014
Keywords: Job satisfaction, unemployment rate, relative position, job insequrity, Spain, Great Recession
JEL Classification: I31, J28, E24
Abstract
The recent recession has generated a tremendous increase in unemployment rates in Spain. In this paper we use a very rich repeated cross-section dataset on workers’ job conditions, together with regional unemployment rates, to investigate whether peers’ unemployment affects individuals’ job satisfaction. We find that, once perceived job stability is controlled for, peers’ unemployment shows a positive effect on individuals’ wellbeing at work, larger and more precisely estimated for men and private-sector workers. The impact is highly non-linear and the largest effect is found for unemployment rates exceeding 10%. Interestingly, the results are robust to controlling for workforce selection.