In this paper, we want to compare the general life satisfaction of employed and
unemployed persons with these persons’ well-being on a specific day of their life, measured
on a moment-to-moment basis. For this purpose, we conduct a survey in which we not only
collect data about life satisfaction and life circumstances in general, but also apply the Day
Reconstruction Method (DRM), which provides an appropriate new tool to measure instant
well-being over the course of one day by combining features of time-budget measurement and
experience sampling (Kahneman et al. 2004a,b). The DRM asks respondents to construct a
diary of the previous day consisting of all activities the person engages in during the day. The
respondents describe each episode, what they did, with whom they interacted, and what
feelings and emotions they experienced during that activity.
In a study similar to the DRM, Krueger and Mueller (2008) compare the emotional well-
being of employed and unemployed persons during similar activities and find that the
unemployed report feeling more sadness, stress and pain than the employed. The well-being
gap between the two groups is particularly large during job-search activities and while
watching television. This result suggests that the results from analyses of general life
satisfaction also show up in the measurement of experienced utility.
But would the unemployed really improve their day-to-day experiences when taking up
employment? In a DRM study with employed women, Kahneman et al. (2004a,b) find that
positive feelings are strongest during leisure activities and when interacting with friends and
family, while negative feelings prevail mostly during episodes of work and work-related
activities. Taking up employment would thus imply that people have to substitute less
enjoyable working time for more enjoyable leisure activities. Experienced utility over the
course of the day thus depends on two effects. First, there is a saddening effect of being
unemployed, i.e. the unemployed feel strictly worse than the employed if both spend their
time in exactly the same activities over the entire day. Second there is a time-composition
effect, i.e. unemployed and employed differ in how they spend their time. This time-
composition effect works against the saddening effect so that it is a priori unclear which of
the two groups feels better over the course of the day.
In this paper, we empirically identify the saddening and time-composition effect and
compare the overall effect with self-reported general life satisfaction. We therefore conducted
a DRM study in Germany, in which we collected data on how employed and unemployed
people use their time on a specific day, their affect levels during all activities they were