Jay Austin, a brand designer at a fintech company, lost his job about two weeks ago. But the dismissal came as no surprise, said 27-year-old Austin, who is trans and uses the pronouns they / m.
The downturn in the market in recent months has hit the technology industry, causing a wave of layoffs. Austin, whose apartment rental in Austin, Texas, ends in August, will receive three weeks’ compensation, but otherwise no savings, they said.
“The worst comes in the worst, I’ll sleep in my car,” said Austin, who earned $ 80,000 a year. “It’s a nasty situation everywhere.”
Increasing stress, Austin will likely struggle to afford the usual weekly therapy sessions, they said. To save money, they are considering downsizing to biweekly or monthly meetings. “Therapy was already expensive,” Austin said.
Austin is hardly alone. So far this year, more than 21,000 technicians have been laid off, according to Crunchbase. Although remarkable, the layoffs make up a small portion of the country’s 8.9 million technology workers, according to employment data from the industrial trade group CompTIA.
Across the economy, the severe financial crisis could escalate as the Federal Reserve pursues a series of interest rate hikes that aim to reduce staggering inflation but risk turning the economy into recession, experts told ABC News earlier this month.
Nearly 70 percent of economists believe the recession will begin at some point next year, according to a survey of 49 macroeconomists conducted by the Financial Times and the Booth School of Business at the University of Chicago this month.
Research has linked economic recessions – shrinking economic output that has lasted at least several months – to rising mental health problems such as anxiety, depression and even suicide, experts told ABC News. In difficult economic times, the spread of potentially catastrophic financial events – such as job loss or deprivation of access – exacerbates existing mental health challenges and creates new ones, further exacerbating these challenges if the financial downturn continues for many months or years.
In addition, because the U.S. health care system largely links insurance to employment, job loss often compromises access to mental health support when one needs it most, experts say. The prospect of increased mental health problems – combined with inadequate support – raises additional concerns in light of the pandemic, which has already affected the psyche of many people, experts added.
“After COVID, there has been an unprecedented rise in mental health problems,” Ronald Kessler, a professor of health policy at Harvard Medical School, told ABC News. “What comes next is a real double whammy.”
The economy usually loses millions of jobs in a recession. During the Great Recession, between 2007 and 2009, non-agricultural employment fell by 6.8 million jobs, while the unemployment rate rose from 4.8% to 9.6%, according to the St. Louis Federal Reserve.
A strong, decades-long body of research links the economic downturn to rising mental health problems, identifying the role played by the jump in major difficulties related to employment, housing and other financial assistance, experts told ABC News.
A 2019 study published in the Psychological Sciences Association – which examines people affected by the Great Recession – found an increase in depression, anxiety and problem drug use among those who have experienced even one major difficulty, such as job loss or deprivation. of access, let alone multiple incidents.
Job losses during the Great Recession increased the risk of mood disorders in the United States by 22 percent, according to a study published last year by researchers at the University of Alberta, which examines the available literature on the subject. The researchers also found that they were 1.2 to 5.8 times more likely to have a major depressive episode related to the homelessness attempt during the Great Recession.
“Existing mental health problems are getting worse, and mental health problems have recently arisen because of some who are facing economic hardship,” Ralph Catalano, a professor of public health at the University of California, Berkeley, told ABC News. “How will you feel if you lose your job?”
Chris Rum, a professor of economics and public policy at the University of Virginia who specializes in the health effects of the downturn, said bluntly, “When the economy deteriorates, mental health deteriorates,” he said.
An alarming finding shows a correlation between recessions and an increased suicide rate, Rum said. Between 2008 and 2010, the first three years after the financial crisis, the suicide rate rose more than four times faster than in the eight years before the crisis, according to a 2012 study in The Lancet. “We have known for many years that the suicide rate is rising steadily with unemployment,” Rum said.
The adverse health effects of the economic downturn are falling disproportionately on low-income people and minorities, as they are less likely to have accumulated savings or alternative sources of wealth that could mitigate the impact, experts said.
“People with lower socio-economic status are always less affected by such things,” Catalano said. “They have a harder time when recessions occur.”
The extent of such effects on mental health depends on the severity and duration of the recession, experts said. The long recession could prolong the time people spend out of work, exacerbating mental health problems as they struggle with financial stress and possible feelings of self-blame, experts say. “When there is a more severe recession, the effects will be more severe,” said Rum, a professor of economics at the University of Virginia.
Of course, the US economy could avoid the recession completely. If a recession occurs, it could be short and easy, some economists predict. A slight decline would blunt many of the worst effects on mental health, in part because people are better prepared to withstand a short-term financial challenge with savings or government support, experts said.
“With economic downturns that are short, that’s not a huge effect,” said Kessler, a professor at Harvard Medical School. “There are a lot of buffering resources for these kinds of things.”
However, the potential recession is stressful, in part because the extent of financial difficulties remains uncertain, even for those in the middle and upper middle class, Rum said. “In general, people live with a degree of anxiety and insecurity,” he said.
A New York-based cryptocurrency exchange employee Coinbase – who was fired this month and asked for anonymity due to the terms of an exit agreement – said the prospect of a recession worried her because it could dry up the job prospects after the compensation expires.
“What if a recession happens and I don’t get anything?” She said. “How will I pay the rent?”
If you are struggling with suicidal thoughts or worrying about a friend or loved one, help is available. Call the National Suicide Prevention Line at 1-800-273-8255 [TALK] for free, confidential emotional support 24 hours a day, 7 days a week.