Recessions lead to short-term job loss, lower levels of happiness and decreasing income levels. There is growing evidence that workers who first join the labour market during economic downturns suffer from poor job matches that have a sustained detrimental effect on their wages and career progression. This paper uses a range of US and UK data to document a more disturbing long-run effect of recessions: young people who leave school in the midst of recessions are significantly more likely to lead a life of crime than those graduating into a buoyant labour market. These effects are long lasting and substantial.

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Brian Bell, Anna Bindler and Stephen Machin

14 July 2014     Paper Number CEPDP1284

Download PDF - Crime scars: recessions and the making of career criminals

This CEP discussion paper is published under the centre's Labour markets programme.