Unemployment scarring is a term used to describe long-lasting effects which emerge from being made unemployed.

According to the ESCR, it is usually used in response to youth unemployment – causing people to have lower pay, higher unemployment and reduced life chances throughout their lives.

Who is at risk?

According to a new report by the Office for National Statistics, there are many factors which could leave people vulnerable to unemployment scarring.

Specifically, the research found that people with disabilities and people who had spent a long time out of a job were most likely to experience long-term unemployment.

Research found that, between 2007 and 2020, only 7.6 per cent of disabled people who were out of work, but had previously had a job, returned to employment in the next three months. This is four times less than the number of non-disabled people in the same position (26.8 per cent).

This has been directly linked to the disability, with disabled people’s chances of finding a job being 7.4 percentage points lower on average than those of non-disabled people.

Another factor which was shown to dampen people’s prospects in terms of finding a new job was the amount of time spent out of a job.

The trend spotted was that the longer a person remained out of a job, the worse their chances of returning to work became.

Around two-fifths of people who had been out of work for up to 3 months returned to work within the next three months. However, this then reduced to just over a quarter (28.5 per cent) of people who had been out of work for up to six months. For people that had been out of work for 5-8 years, this figure dropped to just 7.1 per cent returning to work.

Other factors which contribute towards unemployment scarring include age, level of qualifications, race, and the local unemployment rate.

What can employers do to assist these groups?

Rachel Maguire, co-founder of job-sharing specialists, The Job Share Pair, advocates for the use of returner schemes:

Employers that are actively looking to tap into overlooked talent in this area could consider Returner (sometimes known as Relauncher) programmes. These are essentially mentor-supported schemes that exist specifically to help people who have been out of the workforce for a long time ease back into things as seamlessly as possible.

Building a culture of open discussion and continuous learning is also a way to better integrate people who may feel at a disadvantage after a long period out of work. An open culture and mentor-supported schemes can really set employers apart.

Kate Underwood of Southampton-based Kate Underwood HR & Training, advises:

Extra initiatives that employers and their HR departments could implement include offering one-to-one mentoring and shadowing programmes to help to give people scarred by long-term unemployment an extra bit of confidence and support.

If you’re looking to attract these kinds of employees, be sure to make a point of not ruling people out because they have a gap in employment or lack the experience.

Kate Palmer, HR Advice Director at Peninsula, echoes this:

To give all job applicants an equal footing when applying for a job, employers should pay close attention to all elements of a recruitment process. Even the responses asked for to what appear to be benign questions on a standard job application form can create an image in the recruiter’s mind over who seems to be ‘better’ for a job before they have even met the candidate.

Removing the need to fill in dates of employment avoids declaring gaps in employment history, which the employee may then be asked to explain at the interview. This can prevent unconscious bias from playing a part in recruitment and leaving the factors that matter to speak for themselves.


*The ONS report regarding unemployment scarring can be found here.