TITLE:
Unemployment at a Young Age and Later Unemployment in Native Swedish and Immigrant Young Adults
AUTHORS:
Magnus Helgesson, Bo Johansson, Tobias Nordqvist, Ingvar Lundberg, Eva Vingård
KEYWORDS:
Unemployment; Immigrants; Young Adult; Education; Active Labour Market Program (ALMP)
JOURNAL NAME:
Modern Economy,
Vol.5 No.1,
January
16,
2014
ABSTRACT: The youth unemployment
rate is increasing in many countries and unemployment affects future work
participation. Immigrants have more difficulties than natives in succeeding on
the labour market. This study examined the long-term effect of unemployment on
future unemployment in Sweden. All immigrants born during 1968-1972 and
a random sample of native Swedes of the same age are included. The follow-up
period was 15 years, 1993-2007. Unemployed individuals had an elevated risk of
unemployment during follow-up. The risk of unemployment increased with the
length of unemployment in 1992. Immigrants had a higher risk of
unemployment both at baseline and follow-up compared with native Swedes, but
followed the same pattern as native Swedes when exposed to unemployment. For
individuals with ≥100 days of unemployment in 1992, participation in an Active
Labour Market Program (ALMP) increased the risk of future unemployment, whereas
both higher educational level at baseline and attainment of a higher
educational level between 1993 and 1997 decreased the risk. In addition to
the human suffering caused, this can result in increased welfare payments and
loss of productivity and tax income to a society. Immigrants seem not to be
more vulnerable to unemployment than native Swedes.