Intergenerational joblessness across Europe: the role of labour markets, education and welfare generosity

Recent studies of intergenerational income mobility have used cross-area and cross-national variation in intergenerational elasticities to explore possible drivers of persistence in incomes across generations. We contribute to this literature, and the parallel literature on the effects of social exclusion, utilising a conceptual framework to explore the role of family factors (education and welfare generosity) and labour market conditions in accounting for intergenerational joblessness across Europe. Country-level differences suggest that lower expenditure on education and less generous welfare systems are associated with more intergenerational persistence in jobless spells across countries. We show that simple explanations, such as high unemployment and low education alone do not account for individual-level intergenerational joblessness. Instead, a combination of living in a jobless household in (late) childhood, low education and weak labour markets co-load to create penalties. Taken together, the individual- and country-level analysis point to multiple disadvantage creating persistence of deprivation across generations rather than individual risk factors. This suggests that a targeted and combined policy intervention is required to reduce such associations.