Parental Job Loss and Children’s Educational Attainment in Black and White Middle Class Families

January 2009

Ariel Kalil and Patrick Wightman, University of Chicago

This paper has been revised and is posted as working paper #2010-06.
Download 'working_paper09-02.pdf'.


Abstract

Job loss remains a permanent feature of the American economy. Black and white children may experience parental job loss differently, even when they share the same class location. We address this question using data from the Panel Study of Income Dynamics (PSID), following those children "born" into the survey between 1968 and 1979 and followed through age 21. We focus on middle-class families (defined here as an income between two and six times the appropriate poverty threshold around the time of the child’s birth). We find that parental job loss is associated with a lesser likelihood of obtaining any post-secondary education for all offspring, but that the association for blacks is about four times as strong. Approximately 40% of the differential impact of job loss on black and white middle class youth is explained by race differences in household wealth, long-run measures of family income, and, especially, parental experience of long- term unemployment. We also find suggestive evidence that parental college experience mitigates the adverse associations between parental job loss and children’s educational attainment.



Keywords:
Educational Attainment, Employment, Unemployment, and the Labor Market, Race and Ethnicity