IDEAS home Printed from https://ideas.repec.org/p/bcb/wpaper/616.html
   My bibliography  Save this paper

Household Debt Composition and Labor Market Outcomes

Author

Listed:
  • Nelson Camanho
  • Toni dos Santos
  • Jesús Gorrín
  • Bernardo Ricca

Abstract

How does the composition of personal debt affect job search outcomes? This paper investigates the impact of household debt levels and composition at the time of mass layoffs on job search duration and post-reemploymentwage growth. Using a comprehensive dataset that links personal debt to the employment histories of all formal workers in Brazil, we find that both the level and type of debt significantly shape job search behavior. In line with the theory of debt overhang, workers with high levels of non-collateralized, wage-linked debt are less likely to find new employment but secure higher wages upon reemployment. In contrast, the negative effects areweaker forworkers with collateralized mortgage debt. Overall, our findings underscore the critical role of personal debt structure in shaping labor market dynamics.

Suggested Citation

  • Nelson Camanho & Toni dos Santos & Jesús Gorrín & Bernardo Ricca, 2025. "Household Debt Composition and Labor Market Outcomes," Working Papers Series 616, Central Bank of Brazil, Research Department.
    • Handle: RePEc:bcb:wpaper:616
    as

    Download full text from publisher

    File URL: https://www.bcb.gov.br/content/publicacoes/WorkingPaperSeries/WP616v2.pdf
    Download Restriction: no
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bcb:wpaper:616. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Rodrigo Barbone Gonzalez (email available below). General contact details of provider: https://www.bcb.gov.br/en .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.