Unemployment, inactivity, and hiring chances: A systematic review and meta-analysis

Le résumé fourni par la source

Abstract Policymakers’ push for higher employment rates has renewed attention to the labour market position of long-term unemployed jobseekers and inactive persons. However, stigma related to unemployment or inactivity can hinder their hiring chances when applying for a job. This systematic literature review investigates whether, when, and why periods of not working are penalized in hiring. Our review confirms employers treat the unemployed and inactive less favourably than their employed counterparts. A meta-regression analysis of multi-country experimental data points to heterogeneity by the duration of being out of work: short-term unemployment of up to six months positively affects hiring prospects, while the adverse effects of unemployment scarring become noticeable after about twelve months. These patterns align with signalling mechanisms: immediate availability may offset negative signals in short spells, whereas expectations about reduced productivity plausibly drive negative effects of longer spells. The latter signal seems more pronounced when unemployment rates are low.

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