Abstract
Rising levels of unemployment in European welfare states have revived questions on the social protection of the unemployed and the people’s solidarity with this claimant group. Does people’s solidarity with the unemployed—in terms of the welfare benefits they would grant this group—decrease when the economy fares ill and unemployment is on the rise, or does solidarity increase as many more people are at risk of losing their jobs? And, do changes in economic conditions and unemployment affect the solidarity of all social groups alike, or are there differences with people’s socio-economic position? In this study, we address these questions using repeated cross-section data from the Netherlands in the period 1975–2010. Our multilevel analyses show that in times of higher unemployment people’s solidarity with the unemployed is higher, while independently from that, in times of economic downturn solidarity is lower. These macro-level effects vary only little across social groups, yet we do find that the unemployment rate affects people’s solidarity more positively during economic good times. This indicates that people’s solidarity with the unemployed depends, among others, on the specific macro-economic constellation of economic welfare and unemployment.
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Notes
Another improvement upon the study of Jeene et al. (2014) is that we study to what extent an effect of the unemployment rate on people’s solidarity with the unemployed can be attributed to an indirect effect via individual unemployment. The study by Jeene et al (2014) modeled the unemployment rate effect only net of individual unemployment, which may underestimate the (total) effect of the unemployment rate. Note that because our data only include a relative measure of individual income—relative per wave—, the same argument regarding economic welfare (GDP may lower solidarity by decreasing individual income) cannot be tested.
This principle of risks and reactions to it are also central in economic/social-psychological risk and loss aversion theory (e.g., Kahneman and Tversky 1984). The assumption is that people rather than maximizing utility, which requires taking risks, have a tendency to avoid risks. As the theory has the same implications as our self-interest risk-perspective, we will not discuss it separately.
Unfortunately, our data miss information on occupational status.
In an analysis of Australian time series data over a 20 year period Eardley and Matheson (1999) found a relatively strong negative correlation of − 0.60 between the annual unemployment rate and the proportion of people expressing ‘not wanting to work’ (internal attribution) as a reason for unemployment.
As our focus is on the effects of macro-level economic conditions, we do not spell out the individual-level expectations at length. From self-interest theory, the main prediction is that vulnerable groups (lower income groups, unemployed, lower educated) display greater solidarity with the unemployed than others since they have greater risks to become or stay unemployed and at the same time pay less of the welfare burden of unemployment. For pensioners and the disabled this may be different: they may less fear unemployment as a risk, but may pay the welfare burden because of resource competition with other benefit receivers, thus likely showing lower solidarity towards the unemployed than the unemployed or employed. As for gender, we expect that women show less solidarity than men because their labour market participation is lower, putting them less at risk of losing a job.
That people feel that a certain benefit level is insufficient could partly be a reflection of the (perceived) actual level of benefit. Yet, for the short-term opinion fluctuations that we analyse this is probably not the case, since actual benefit levels are related to worker’s previous wages or to the minimum wage level, both of which do not show the drastic fluctuations in time that we do see in our dependent variable.
We do not model age in categories or in a non-linear fashion since we already include the pensioner status in our models.
However, these models do not take into account serial correlation on the macro-level, that is that the error term ut for year t may be correlated with the error term ut+1. Probably, this correlation is positive given path dependency (but less so for annual GDP growth/downturn). We considered correcting for autocorrelation by including a general trend parameter in the models, yet as the level of GDP nearly increased linearly over time in the observed period and because we included this variable in all models, this was redundant.
Additional, unreported analyses indicate that the effect of a change in GDP on people’s solidarity with the unemployed results from economic downturn rather than from economic boom since it is in economic downturn that solidarity changes most.
We could not properly model the interactive effect of economic downturn and the unemployment rate as there were only few waves with economic downturn and varying levels of unemployment.
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Appendix: Robustness Analyses
Appendix: Robustness Analyses
We performed several analyses to check whether results were robust with distinct specifications. Results are available upon request with the authors.
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Logistic Models We checked whether a logistic specification of the outcome variable rather than a linear specification affected our findings. This did not appear to be the case: relevant coefficients were in the same direction and showed a similar pattern of statistical significance.
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‘Don’t Knows’ on Solidarity Measure We checked whether omitting the ‘don’t know’ answers (19%) from the ‘low-solidarity’ category (code 0) influenced our findings. This hardly did so. Only the effect of economic downturn varied somewhat more across social categories (notably a less negative effect for middle and higher educated than for lower educated), yet with the same pattern as displayed in Table 4. To preserve statistical power, we decided to keep the ‘don’t know’ answers in our analyses.
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Lagged Effects of Economic Cycle Factors Lagged measures (t-1, t-2) for economic downturn and unemployment rate displayed a weaker effect of economic downturn, but an unchanged (significant) effect of the unemployment rate. This indicates that the effect of economic downturn is more immediate than that of the unemployment rate.
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Linear Specification We checked our findings using linear specifications of income (excluding missing values) and education (also using the original seven categories). The findings were the same, both with respect to main effects of these variables and interactive effects with economic conditions.
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Three-way Interaction We checked for a three-way interaction of GDP, the unemployment rate and income, in the idea that during a period of low GDP, a rise in unemployment may especially affect the solidarity attitudes of middle income groups due an increased welfare burden (cf. H3a). This and other three-way interactions were not statistically significant (p > 0.05).
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Uunk, W., van Oorschot, W. Going with the Flow? The Effect of Economic Fluctuation on People’s Solidarity with Unemployed People. Soc Indic Res 143, 1129–1146 (2019). https://doi.org/10.1007/s11205-018-2023-z
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DOI: https://doi.org/10.1007/s11205-018-2023-z