Using matched-file data from the January and March 1986 Current Population Surveys, the author estimates a model of earnings reduction and family income replacement in 1985 for a group of married men displaced from full-time nonagricultural jobs. The displacements, which occurred between 1981 and 1984, resulted in substantial earnings losses for a large fraction of the sample. Husbands with earnings losses had higher levels of spouse earnings and income transfers in 1985 than the control group of non-displaced husbands, but the fraction of lost earnings replaced was not large on average. The author concludes that long-term trends in both the nature of the experience of displaced workers and the structure of the family economy call for reconsideration of traditional family adjustment mechanisms.
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