The Consequences of Job Displacement for Health: Moderating Influences of Economic Conditions and Educational Attainment

• The impact of job loss on health is worse when unemployment is high.
• The impact of job loss on health is worse for persons with a bachelor’s degree.
• Persons displaced in a strong economy, experience minimal health consequences.

This paper examines the impact of worker displacement on health in the United States from 1975–2004, especially the extent to which the impact of displacement on health varies according to the economic conditions in the year of displacement and the education level of the displaced worker. Findings from ordered probit and fixed effects models suggest that the negative impact of displacement on health is exacerbated by a higher unemployment rate at the time of displacement and for displaced workers with a college degree.