We studied the effect of health events (accidents and chronic diseases) on the occupation probabilities at the individual level, while accounting for both correlated individual and time effects. Using difference-in-differences with exact matching estimators, we found that health events have a strong impact on individual labor market histories. The workers affected by a healt event have a stronger probability of entering inactivity and a lower probability of keeping their jobs. We also found that the less qualied workers, women, and workers with short term jobs are the most negatively affected by health events.
The impact of health events on individual labor market histories : the message from difference in differences with exact matching