Non-employment, age, and the economic cycle

Abstract

We describe the relationship between non-employment rates and age in Britain and consider how this relationship has been changing with the economic cycle. Using data from the British Household Panel Survey for survey years 1991–2008 and Understanding Society for 2009, we show that non-employment rates have changed most for people in the youngest and oldest age groups. Young people have been hit particularly hard by the current recession and non-employment rates are higher now than during the early-1990s recession, especially for those without educational qualifications. Among older men and women, non-employment rates have been in longer-term decline and the current recession has had a less marked effect. Hence the U-shaped non-employment/age relationship has rotated clockwise over the last decade.