The Human Cost of Recessions: Assessing It, Reducing It
IMF Staff Position Notes, November 11, 2010
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- The Human Cost of Recessions: Assessing It, Reducing It
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Bibliographic details
- Authors: Mai Dao, Prakash Loungani
- Published: November 11, 2010
- Series: IMF Staff Position Notes
- DOI: https://doi.org/10.5089/9781462308163.004
Summary and central findings
- Recessions leave scars on the labor market.
- Over 200 million people across the globe are estimated to be unemployed at present resulting from the Great Recession of 2007–09.
- The paper surveys what is known about the effects of past recessions to assess the human cost of increased unemployment.
- If past is prologue, the cost to the unemployed (and society) could be high.
- The focus of this paper is on advanced economies.
- Most countries mounted strong policy responses to minimize the human costs; the policy actions were notable for their consistency and coherence across countries.
Policy analysis and recommendations (high-level)
- Emphasize strong, coherent policy responses to limit labor-market scarring from recessions.
- Address aggregate demand shortfalls to reduce unemployment and associated human costs.
- Consider benefits provision, unemployment insurance (UI benefit), and work program design as tools to mitigate the adverse effects of recessions on workers and wages.
Scope, subject matter, and keywords
- Subject: Labor, Labor markets, Unemployment, Unemployment rate, Wages
- Keywords: aggregate demand, benefits provision, demand shock, Europe, Global, headline inflation, job loser, Labor markets, North America, SPN, UI benefit, Unemployment, unemployment insurance, Unemployment rate, Wages, work program
Content in this bundle
- _spn1017 — Annex 1: Fiscal Adjustment and Income Distribution in Advanced Economies