Open Access

Set against the backdrop of the Great Recession, the paper explores the interplay of unemployment experiences and political trust in the USA and 23 European countries between 2002 and 2017. Drawing on harmonized data from the European Social Survey and the General Social Survey, we confirm that citizens’ personal experiences of unemployment depress trust in democratic institutions in all countries. Using multilevel linear probability models, we show that the relationship between unemployment and political trust varies between countries, and that, paradoxically, the negative effect of unemployment on political trust is consistently stronger in the more generous welfare states. This result holds while controlling for a range of other household and country-level predictors, and even in mediation models that incorporate measures of households’ economic situation to explain the negative effect of unemployment on trust. As expected, country differences in the generosity of welfare states are reflected in the degree to which financial difficulties are mediating the relationship between unemployment and political trust. Overlaying economic deprivation, however, cultural mechanisms of stigmatization or status deprivation seem to create negative responses to unemployment experiences, and these render the effect of unemployment on political trust increasingly negative in objectively more generous welfare states.

This paper studies the intergenerational effects of parental unemployment on students’ post-secondary transitions. Besides estimating the average treatment effect of parental unemployment on transition outcomes, we identify the economic, psychological or other intra-familial mechanisms that might explain any adverse impact of parental unemployment. Using longitudinal data from the German Socio-Economic Panel and propensity score matching estimators we find that paternal unemployment has an adverse impact on the likelihood of entering tertiary education, whereas maternal unemployment does not. We also find that the magnitude of the effect depends on the duration of unemployment. Even though we are unable to fully account for the underlying mechanisms, our mediation analysis suggests that the effect of paternal unemployment is not due to the loss of income, but relates to the negative consequences of unemployment for intra-familial well-being and students’ declining optimism about their academic prospects.

The article presents an analysis of the development of labour market risks in Germany in light of changing working poverty risks. Low hourly wages and part-time employment are identified as the main demand-side-related mechanisms for household poverty. Their measurement and development are discussed as well as their contribution to trends in working poverty risks. A rise in low wages, especially among part-time employed households, was decisive for the increase in working poverty risks in Germany by 45% between the end of the 1990s and the end of the 2000s. We therefore study these trends more closely in the multivariate analysis. The results show that while low wages are unequally distributed across occupations and industries, shifts in employment between sectors explain only a minor part of the change in low wages. However, they reveal a polarization of low-wage risks by skill-level and sector of employment, on the one hand, and full-time and part-time employees, on the other hand.