“I have a feeling that these kids will always be identifiable as the kids of parents who faced these problems,” says Ann Huff Stevens, an economics professor and the director of the Center for Poverty Research at the University of California (Davis). “Even if we do get the recovery going, the effects have already happened to the kids, and from what we know, these effects can be pretty substantial and negative.”
CAUGHT A RIPTIDE
Members of this shadow generation have already started out their young-adult lives with a distinct disadvantage, especially if their parents did not have a college degree or were already struggling to stay within striking distance of the middle class. Children of the unemployed are 15 percent more likely to repeat a grade than their peers whose parents held on to stable jobs, a 2009 study by Stevens and economist Jessamyn Schaller found. They are more likely to live with adults whose health is affected by a job loss. Life expectancy drops by 12 to 18 months for people who are unemployed for a long stretch of time, according to a study by economist Till Marco von Wachter and Daniel Sullivan, the director of research and an executive vice president at the Federal Reserve Bank of Chicago.
Worse, their families may never recover financially; even 15 to 20 years later, losing a job can translate to as much as $140,000 less in lifetime wages, according to a 2009 paper by von Wachter, Jae Song, and Joyce Manchester. For many families, a job loss also nudges them into poverty. From August 2008 to August 2009, Brookings reports that the number of children on food stamps jumped by 3.4 million.
Adulthood doesn’t necessarily offer relief, either, for the children of the unemployed: They tend to have a hard time in the job market. A 2005 study showed that children whose fathers lost a job during the recession in the early 1980s earned 9 percent less in wages during their lifetimes than children whose parents held on to their jobs. They were also more likely to end up on unemployment or some form of social assistance as adults.
The research says nothing, however, about the emotional trauma that comes from a parent losing work in a bleak economic climate: the possibility that the family may be forced to move; the lack of resources to invest in education; and, in the short run, the amount of quality time that overstressed parents can spend with their children.
Many parents who lose their jobs—particularly fathers, Kalil says—also experience an identity crisis about their role in the family, especially if they are unable to earn money for a long period.
Such below-the-surface issues are hard to identify, sitting as they do at a squishy intersection of economic policy, the labor market, and private family dynamics. “The question is whether these are knowable things,” says Schaller, an assistant professor of economics at the University of Arizona. “If we know your parents losing their jobs makes you more likely to drop out of high school, what we don’t know is why. Is it stress, or health outcomes, or other things going on in families?”