Many people in Michigan and throughout the United States believe that the impact of a bankruptcy is disqualifying for future employment. People have been told that employers view bankruptcy as a sign of unreliability and hesitate to hire people who have filed for it. However, new research shows that this may be beginning to change. Perhaps this is because some of the social stigma surrounding bankruptcy may be starting to dissipate.
Researchers compared the prospects of people who had a bankruptcy on their record against those of people who had it removed. They were surprised to find that bankruptcy on one’s record had a negligible impact on their job prospects. Moreover, they also noted that bankruptcy did not cause people to lose their jobs. This is contrary to the results of previous research.
The 2008 recession likely changed the way that many people look at bankruptcy. There is less of a view that the debtor has done something wrong and more acceptance that they were impacted by events beyond their control. While the results of this research are contrary to what was previously found, society may soon have an impetus to test this hypothesis as the COVID-19 crisis is likely to cause widespread job loss and a surge in bankruptcy filings. The hope is that those who are forced to file can truly get a fresh start.
Those who are in financial distress may want to take the time to learn more about how the Chapter 13 bankruptcy process works. It might allow them to repay their debts from regular income that they earn. A bankruptcy law attorney may explain how their client might benefit from the protection that the law gives from debt that has become unmanageable.