Afraid of losing your job? Then you need to be.

Being afraid of losing your job turns out to be a strong predictor of actually losing your job:

This article examines whether subjective expectations of unemployment are reliable indicators of the probability of becoming unemployed and investigates their association with wage growth. We find that workers fears of unemployment are increased by their previous unemployment experience and by the unemployment experiences of a close friend, and are associated with other objective indicators of insecure jobs. We then show that unemployment fear predicts future unemployment, above and beyond observed objective variables. High fears of unemployment are found to be associated with significantly lower levels of wage growth for men, but to have no significant link with wage growth for women.

Source: “Job Insecurity and Wages” from Economic Journal, Vol. 117, No. 518, pp. 544-566, March 2007

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