The Great Recession of 2008 has led to elevated unemployment in Europe and thereby revitalised the question of causal health effects of unemployment. This article applies fixed effects regression models to longitudinal panel data drawn from the European Union Statistics on Income and Living Conditions for 28 European countries from 2008 to 2011, in order to investigate changes in self-rated health around the event of becoming unemployed. The results show that the correlation between unemployment and health is partly due to a decrease in self-rated health as people enter unemployment. Such health changes vary by country of domicile, and by individual age; older workers have a steeper decline than younger workers. Health changes after the unemployment spell reveal no indication of adverse health effects of unemployment duration. Overall, this study indicates some adverse health effects of unemployment in Europe--predominantly among older workers.
Keywords: Fixed effects analysis; Health inequalities; Self-reported health; Unemployment.
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