Abstract

In recent years, well-being indicators have become an important tool for the analysis of the impact involuntary unemployment has on the individuals. Previous economic research mainly concentrates on one measure of subjective well-being, overall life satisfaction. This project intends to broaden this perspective. It examines the impact of unemployment on three different concepts of well-being – subjective, psychological and physical well-being – by applying an integrated and interdisciplinary research approach. We focus on three overarching research questions. Firstly, we analyze in how far the effects of involuntary unemployment differ between the various well-being indicators. Secondly, we examine how these effects vary over time. Thirdly, we identify factors that benefit well-being during persistent unemployment. Since the existing data is insufficient to provide satisfying answers to these questions, new data will be collected for this project. In a first step, we use administrative data to identify persons affected by mass layoffs and start to follow them from the moment they officially register as being jobseekers. They will be interviewed once a month over a period of two years (as well as a control group of employees). The comprehensive panel data will be collected with the help of an innovative generic smartphone app. This allows us to closely investigate the relation between unemployment and the different well-being indicators over time. In addition, this type of survey helps identify resilience factors, such as the initial levels of different well-being indicators, and inter-individual differences in coping strategies. The new panel data can be linked to administrative data (e.g. employment biographies) in order to analyze the relation between the well-being effects of involuntary unemployment and the actual job seeking behaviour as well as the unemployment duration. This allows us to identify which indicator of well-being is most relevant for the decisions made during unemployment and thus constitutes the best proxy of the economic concept of utility, at least in the context of unemployment. The new findings regarding individual well-being effects of unemployment, psychological processes triggered by unemployment as well as coping and resilience over time may help to better individually tailor and hence more efficiently design active labour market policies.