A study on 25 EU countries published in The Lancet recently presents evidence that in times of economic and financial crisis, as unemployment rates rise and people suffer economic hardship, suicide and homocide rates also increase. A rise of 3% in unemployment rates is accompanied by a 4.5% increase in suicides and a 28% increase in deaths from alcohol abuse  in the population younger than age 65, indicating the mental distress among workers and families.

The study finds that effects differ from country to country in corellation with different levels of social protection spending. Countries with active labour market policies that invest in job retention, job creation and help unemployed people quickly enter new jobs were unlikely to see mortality rates increase. The study concludes that these active labour programs protect public health during recession better than many other options currently considered by governments such as hospitalization programs or pensions adjustments.

Source: "The public health effect of Economic Crisis and Alternative Policy Responses in Europe: an Empirical Analysis", The Lancet,  Volume 374, Issue 9686, Pages 315 - 323, 25 July 2009

In this part of his speech, professor Stiglitz explains how social security can be an automatic stabilizer for the economy, limiting negative effects in time of crisis:

Click here to watch the full speech

Read profesor Stiglitz's article "The global crisis, social protection and jobs", in the International Labour Review, Vol. 148 (2009), No. 1-2