Swedish infants less affected by parental unemployment, says study

A new study from Umeå University suggests that a relatively generous and egalitarian welfare state, like the Swedish one, can protect families against the effects of negative economic shocks.

Research over the last decades has convincingly demonstrated that experiences during pregnancy, and infant's health at birth, can have long-lasting consequences for children's health and academic achievements when they grow up. Research also shows that unemployment can be harmful for families by causing stress and reducing household income and consumption. However, there is surprisingly little evidence on whether parental unemployment causes poorer infant health.

In their recent study, Björn Högberg, Associate Professor at the Department of Social Work, Anna Baranowska-Rataj, Professor at the Center for Demographic and Aging Research, both at Umeå University, and Jonas Voßemer, Postdoctoral Research Fellow at the Mannheim Center for European Social Research, fill in this research gap.

"By studying the impact of stressors in the family on the infant, we can better understand how infant's health and development is shaped during pregnancy," Björn Högberg says. "Understanding how social advantage and disadvantage is transmitted across generations is also important for promoting equality of opportunity. We hope that we can help identify children that may have a higher risk of experiencing poor health at birth. This knowledge is relevant for professionals who encounter pregnant women, such as midwives at maternity clinics."

Very small effects in Sweden

The researchers analyzed register data from Sweden, including 1.5 million siblings born between 1996 and 2017. Since there are many factors that may raise the risk of parental unemployment and simultaneously worsen infant health, this study adopts sibling comparison design, where siblings in a family whose birth happened around the time of parental unemployment, are compared to siblings within the same family who were born when parents were employed.

"In our Swedish study, we found small and not consistently significant effects of maternal unemployment on infants' health, and no effects of paternal unemployment," Anna Baranowska-Rataj continues.

"The differences between our results and previous studies from the U.S. that have relied on similar methods are striking. We find very small or zero negative effects of parental unemployment, while American studies have found sizeable negative effects of a magnitude that really could hamper the children's development later in life. In the cases where we do find some negative effects they are less than a tenth as large as those reported in American studies."

"It is also noteworthy that while we found that maternal unemployment did have some, though small, negative effects, paternal unemployment did not seem to matter at all. This contrasts with much previous international research on effects of parental unemployment on non-infant children, which has often found father's unemployment to be most consequential. The difference is probably partly because it is the mother who is pregnant, but it may also be because dual earner households are more common in Sweden and the mother's employment status is therefore equally important for the family's resources."

Does labor market and welfare policies play a role?

In the Swedish study, the researchers could not find that the effects of unemployment during birth were stronger in more vulnerable groups, for example parents with lower educational level or a migrant background.

"We had expected that effects would be more negative for more vulnerable groups, since these groups have less resources that they that they can use to compensate for the income loss following unemployment." Björn Högberg says.

"It may be that welfare policies are especially effective at buffering negative effects for these groups, precisely because they have fewer resources. If more essential services are tax-funded and often free of charge—most notably maternity care—then your own resources are less consequential."

"There are also reasons to believe that the smaller effects found in Sweden compared to the U.S. are at least partly due to the different labor market and welfare policies." Anna Baranowska-Rataj says.

"First, the Swedish welfare state compensates for more of the income loss associated with unemployment. Second, health care in Sweden is tax-funded to a larger extent and not tied to employment. In contrast, American workers often lose their health insurance when they lose their jobs. Third, Sweden has a more developed and accessible system of maternity care focused on prevention and health promotion."