Do immigrants suffer more from job loss? Unemployment and subjective well-being in Germany

Clemens Lechner, Friedrich-Schiller-Universität Jena
Liliya Leopold, European University Institute
Thomas Leopold, University of Amsterdam

This study asked whether immigrants suffer more from job loss than German natives do. Compositional, psychosocial, and normative differences between these groups suggest that various factors intensifying the negative impact of unemployment on subjective well-being are either more prevalent, more influential, or distinct among immigrants. Based on longitudinal data from the German Socio-economic Panel Study (1990–2012; N = 36,296 persons aged 20 to 64; N = 240,071 person-years), we used fixed-effects models to trace within-person change in subjective well-being across the transition from employment to unemployment and over several years after job loss. Results showed that immigrants’ average declines in subjective well-being exceeded those of natives. Further analyses revealed gender interactions. Declines were smaller and similar among immigrant and native women. Among men, declines were larger and differed between immigrants and natives. Immigrant men showed the largest declines, amounting to one standard deviation of within-person change over time in subjective well-being. We conclude that psychosocial factors render immigrant men most vulnerable to the adverse effects of unemployment.