Lifecycle Events and Their Consequences: Job Loss, Family Change, and Declines in Health

By Kenneth A. Couch; Mary C. Daly et al. | Go to book overview

CHAPTER TWO
Job Loss
Historical Perspective from the Displaced
Workers Survey, 1984–2010

Henry S. Farber


INTRODUCTION

The Great Recession from December 2007 to June 2009 is associated with a dramatic weakening of the labor market, which is now only slowly recovering. The unemployment rate remains stubbornly high, and durations of unemployment are unprecedentedly long. In this chapter I use the Displaced Workers Survey (DWS), administered every two years from 1984–2010, as a supplement to the Current Population Survey (CPS), to examine the experiences of job losers in the Great Recession and compare them to those of job losers in previous years, both in and out of recessions. The January 2010 DWS is of particular interest because it covers job loss during the Great Recession (2007–09).1

An important concern in the aftermath of the recession is the high unemployment rate, which remained at 9.6 percent in the fourth quarter of 2010, more than one full year after the “official” end of the recession in June 2009.2 The first panel of Figure 2.1 contains a plot of the quarterly, seasonally adjusted civilian unemployment rate from 1978 through the second quarter of 2011.3 Labor market conditions over the period covered by the DWS (1981–2009) have varied substantially. The early 1980s saw a sharp increase in the unemployment rate to more than 10 percent during the July 1981 to November 1982 recession. This increase was followed by a long decline during the remainder of the 1980s. The unemployment rate then increased to almost 8 percent in 1992 before beginning another long decline to about 4 percent in 2000. After the comparatively mild recession in 2001 (when the unemployment rate was

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