Similarly, the long-term scarring effect of parental unemployment experienced at ages 11-15 is on average about 0.34 points (on a 0-10) scale, which represents about 5 percent of the sample mean.
The effects we estimate are relatively modest: Parental unemployment experienced at ages 0-5 lowers young adults’ life satisfaction by about 0.59 points on average, which is about 8 percent of the sample mean.
In support of this, previous research from Germany finds that the unemployed spend almost twice as much time caring for their children than employed people and that childcare is, in fact, the only activity that the unemployed enjoy more than the unemployed. Also, interestingly, some children who experienced parental unemployment can have positive consequences as young adults-likely due to the parental investment and the quality of the time unemployment parents spend with their kids. Boys, for example, tend to be more negatively affected by parental unemployment compared to girls, possibly because at younger ages girls show better emotional self-regulation. Of course, children’s experiences following parental unemployment are likely to vary according to different circumstances.
Another reason could be that at older ages, children start developing abstract thinking, which can make them more aware of the social stigma associated with having jobless parents. Older children, on the other hand, may feel pressured to take more responsibility in the family. This suggests that the psychological cost of parental unemployment may be higher for young children because negative experiences accumulate over life and stressful events early in life have a stronger effect on outcomes later in life. Furthermore, by using German panel data tracking children and their parents for over three decades, we find that respondents who experienced parental unemployment during early (0–5 years) and late (11–15 years) childhood have lower life satisfaction at ages 18–31. We measure subjective well-being using a survey question that asked respondents to rate the satisfaction with their lives as a whole on a scale of 0 (not at all satisfied) to 10 (very satisfied). Assistant Professor, Hankamer School of Business - Baylor University
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