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Reskilling Programs Help Injured Workers and Their Partners

Workplace injuries that lead to job loss can have devastating economic and psychological effects on employees, leading to higher rates of depression and opioid use.

But injured workers can get a meaningful boost from reskilling programs, which allow them to pursue higher education and return to the labor market in a new capacity, finds research from Chicago Booth’s Anders Humlum and postdoctoral scholar Pernille Plato of the University of Copenhagen. What’s more, the programs also benefit their partners.

To see the effects of reskilling, the researchers analyzed Danish register data from 1995 to 2017 for some 4,000 men and their female partners. The data combined information on workplace accidents, reskilling activities, labor-market outcomes, healthcare utilization, and romantic partner relationships.

In Denmark, injured workers who lost their job as a result of the injury typically receive disability benefits of about 19,000 kroner (approximately US$2,700) per month, equivalent to 50–80 percent of their prior salary. Alternatively, if qualified, they can enroll in reskilling programs that are subsidized at the same amount. Some vocational degrees allow for this access. For example, carpenters, electricians, and welders can enroll directly in higher-education courses. However, blacksmiths, iron workers, and manufacturing technicians must first complete high school to qualify for higher education—and otherwise remain on disability.

Humlum and Plato find that, on average, about 20–30 percent of all injured workers were still receiving disability payments a decade after their accident. Some people who were offered access to reskilling took advantage of that opportunity: 11 percent of them enrolled in higher education and eventually reentered the workforce.

A way forward after an injury

The research finds that in Denmark, injured workers took antidepressants more than those who were not injured, but less so if provided access to education programs. Antidepressant prescriptions among their partners were also less common.

Taking such steps was good for mental health: 10–15 percent of workers started taking antidepressants within the first four years of losing their jobs, but that number was about five percentage points lower for workers in the reskilling group. Education helped prevent one case of depression for every two to three injured workers, according to the study.

The mood boost was strongest during the time workers were enrolled in a reskilling program. The researchers note that this is likely because engagement in a program can give workers hope, and their spirits can drop once classes end.

The classes also reduced workers’ use of painkillers, which can be addictive. In the year after an accident, opioid use for all workers rose by about 30 percent, on average. But workers with access to reskilling were 5 percentage points less likely to stay on opioids. This effect lasted for up to a decade after the accident. Reskilling was also associated with a lower likelihood of receiving an alcoholism-related diagnosis such as liver disease.

The benefits from reskilling extended to romantic partners, who weren’t themselves physically hurt by workplace injuries but were nonetheless helped by the investment in education. About 7 percent of romantic partners whose significant other didn’t have access to reskilling started taking antidepressants, but the average was 2 percent among couples with a partner who could reskill. And just as reskilling helped prevent depression among workers, it helped prevent it among partners by a similar amount—and the mental health benefits for partners lasted longer.

Partners’ employment participation declined by about 5 percent following a workplace injury without reskilling access, likely reflecting the emotional and economic toll such an event can take on a mate. However, partner employment remained stable when there was reskilling access.

Reskilling had a negative effect on relationship stability, as separation rates slightly increased for those who reskilled, while workers who didn’t were more likely to stay with their partner. Reskilling may have allowed people more freedom to leave, Humlum conjectures. “When the injured workers reskill, couples are indeed more likely to separate, but this may reflect that they are freed up from an otherwise burdensome relationship.”

Overall, the researchers find, the benefits generated by reskilling programs far outweighed the costs, particularly when spillover gains were factored in. Every dollar spent on reskilling generated nearly $4 in additional earnings for injured workers and $1.30 in additional earnings for workers’ partners. “When injured workers are able to reskill, their partners face fewer economic and emotional burdens and contribute more to the labor market,” the researchers write.

The reskilling investment yielded the equivalent of 80 cents in mental health benefits for injured workers and $1.10 for their partners, a calculation the researchers made by assigning a monetary value to improvement in quality of life as a result of a reduction in antidepressant use, as well as including the cost savings associated with fewer antidepressant prescriptions.

The total spillover gains amounted to 83 percent of the direct earnings gains, according to the research.

Humlum notes that while this research focused on reskilling after work injuries, he and Plato see it through a broader lens. “The lessons extend to workers adapting to other labor-market disruptions, including rapid technological change,” Humlum says. “If artificial intelligence suddenly displaces your job, our evidence suggests that effective reskilling programs may be critical.”

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