It stands to reason that unemployment has strong associations with criminal activity, but research from Bocconi University highlights just how much. The researchers show how after a period of significant layoffs, a surge in crime often results. As a result, they argue that policies to get people back into work as quickly as possible can have a dual benefit.

The researchers examined individual-level data on male workers and criminal cases in Brazil between 2009 and 2017. They found that a period of mass layoffs results in a 23% increase in the likelihood of criminal prosecution.

“In an unemployment crisis,” the researchers explain, “income support should be accompanied by active labor market policies aimed at speeding up the return of workers to jobs and guaranteeing stable income rather than temporary income assistance. Furthermore, both passive and active policies should be targeted at vulnerable groups, because such groups are at greater risk of poverty upon layoff and consequently are more likely to commit crimes.”

Risk of crime

What’s more, after the initial spike in the probability of prosecution after a job loss, the risk remains high for a number of years, especially if the individual concerned isn’t supported by unemployment insurance. Indeed, the researchers believe that this protection needs to cover 80% of their salary in the months after their redundancy to mitigate the risk.

They were also able to identify the chances of specific kinds of crime being conducted, with there being a 43% increase in the chances of economically motivated crimes and a 17% increase in the risk of violent crimes being committed. These risks were especially strong among groups with little financial buffers, such as younger workers or those with lower qualifications.

What’s more, the researchers found that this can also increase the chances of children falling into a life of crime if their parents are laid off, with the risk of cohabiting sons of displaced workers committing crime rising by 18%.

“Our results support economic explanations, primarily liquidity constraints over alternative hypotheses,” the researchers explain. “Furthermore, the increase in all types of crimes, including offenses with no economic motivation, such as car traffic violations, suggests that psychological stress upon job loss also plays an important role.”