Resumen de Job satisfaction, insecurity and the Great Recession: The effect of others´unemployment

Cristina Borra Marcos, Francisco Gómez García

• Job security may be considered the most important w orking condition during an economic recession.

  In this paper we use a very rich repeated cross-sec tion dataset on worker´s job conditions, together with regional unemployment information at the activ ity level, to test whether employees value job security differently after the recent economic down turn. We use subjective-wellbeing measures of perceived and actual job insecurity in our assessme nts. We find that peer´s unemployment affected job satisfaction negatively before the recession, but n ot afterwards. The economic valuation of job insecurity increased after the financial crisis whe n measured subjectively. Objective measures related to the industry´s unemployment rates decreased. Our main conclusions are robust to sample selection and method of computation. This suggests that incre ased job insecurity constitutes an important welfare loss associated with increased unemployment during recessions.