Beyond networks: ‘social cohesion’ and unemployment exit rates

Abstract

This paper provides convincing new evidence on the role of social resource patterns in shaping an individual's chances of entry to the labour market. It links movements out of unemployment into employment to constructed indicators of 'social cohesion'. These are social participation, social support and the social network. It was found that the current duration in a state has an influence on the probability of exit from that state. However, even after controlling for this and many other demographic and economic factors, the social network measure remained a significance influence on whether the unemployed found a job. Respondents who have close employed friends are significantly more likely than those who do not to exit unemployment. Why is this the case? Previous research has shown that the more socially integrated individuals have greater access to useful job information flows. In addition, this study has found that the unemployed who have close employed friends are significantly less likely to suffer psychological distress. In this sense, policies which isolate the unemployed into ghettos (for example, council housing schemes) do much harm and may play a large role in keeping the unemployed, unemployed.