Parental Job Loss and Young Adult Achievement

Ariel Kalil, University of Chicago
Patrick Wightman, University of Michigan

Without a doubt, the effects of parental joblessness on the well-being of children have rarely been more relevant than in the current economic climate. Nevertheless, the nature of children’s experiences in families with jobless workers is not fully understood. The present study uses high-quality nationally representative data from the Panel Study of Income Dynamics and its Transition to Adulthood Supplement (TAS), to address the associations between parental job loss during childhood and educational attainment in young adulthood. We find that nearly 40% of young adults in the TAS experienced a parental job loss at some point during their childhood. The children of job-losing parents are eight percentage points more likely to drop out of high school (compared to the sample average of 12%) and, conditional on this, eleven percentage points less likely to attend college. Parental job loss in early childhood is a particularly important predictor of longer-term educational outcomes.