Structural Change and Long-Term Unemployment in Ireland

JEL Classification J10

Eric A. Strobl and Patrick P. Walsh

Department of Economics, Trinity College, Dublin 2, Ireland

Abstract

In this paper we investigate the build-up in male long-term unemployment by allowing for heterogeneity both in the unemployment inflow and conditional survival rates. We construct semi-annual series of the male flows into and out of the Irish Live Register for the period 1967 to 1995 and develop a methodology that allows us to decompose the unemployment inflow by age and unemployment scheme and the unemployment outflow by duration of spell, age and unemployment scheme. Our results in conjunction with other evidence indicate that it was heterogeneity in the unemployment inflow caused by the changing occupational structure of employment over the 1980s that caused the build-up and persistance of male long-term unemployment in Ireland.

Acknowledgements

The research is part of a project on "Who are the Unemployed in Ireland?" funded by the Royal Irish Academy, Social Science Research Council.