The impact of excess body mass on employment prospects in Australia

This paper investigates whether overweight and/or obese individuals face diminished employment prospects in the labour market in Australia. Exploiting the 2006-2019 Household, Income and Labour Dynamics in Australia survey panel data, we implement empirical strategies that account for the role of previous-period employment and previous-period body mass on current employment. We find less than compelling evidence that individuals carrying excess body mass (as measured by body mass index, BMI) are less likely to be employed in Australia. Results from the dynamic correlated random effects probit, which assumes functional linearity of unobserved time-constant heterogeneity and strict exogeneity of body mass, yield a negative association between excess body mass (BMI as a categorical or continuous variable) and employment. The finding is robust to the use of a narrower definition of employed/unemployed and BMI values corrected for subjectivity bias. When both assumptions are relaxed through the generalised method of moments procedures, none of the excess body mass coefficients attain statistical significance. Conducting a granular analysis by gender, no association between excess body mass and employment for men or women is evident, regardless of the empirical strategy that is adopted. Investigating the channels of effect, the results also fail to give credence to (taste-based/statistical) discrimination and health-related productivity as channels influencing the excess body mass-employment relationship in Australia. Overall, we fail to garner convincing evidence that individuals' excess body mass status lowers their employment prospects in Australia.