Early-career unemployment in Germany leads to long-term earnings scars.
Early-career unemployment in Germany can lead to lower earnings later in life. A study followed over 720,000 male apprenticeship graduates for 24 years and found that those who experienced unemployment early on had reduced earnings in the long term. This effect was not due to other factors like the closure of the training firm. The impact of early-career unemployment on earnings varied depending on the individual's earning potential. Those with high potential could recover better, while those at the bottom of the earnings scale suffered more. Preventing early-career unemployment could have lasting positive effects on future earnings.