The Short-Run Effects of Unexpected Job Loss on Health

This paper provides new evidence on the effect of job loss on health. Using unique micro-level panel data from the Netherlands with detailed information on health measures, employment, and job loss expectations, we estimate the immediate effect of unexpected job loss on health. We find no evidence for decreases in health, either physical or mental, upon job loss, but clear evidence for immediate reductions in headaches and fatigue. Our results suggest that the immediate effects of reduced work stress are larger than the immediate increase in financial stress from job loss.