Skip to main content
PMC home page
Springer Nature - PMC COVID-19 Collection logoLink to Springer Nature - PMC COVID-19 Collection
. 2022 Mar 23;20(3):537–558. doi: 10.1007/s10888-021-09522-6

The heterogeneous effects of COVID-19 on labor market flows: evidence from administrative data

Alessandra Casarico 1,2,3,✉, Salvatore Lattanzio 4
PMCID: PMC8940582  PMID: 35342379

Abstract

We investigate the short-term effects of COVID-19 on labor market flows and how they are mediated by labor market policy. Using Italian administrative data on a sample of active contracts between 2009 and the second quarter of 2020, we show that, before the pandemic, a higher share of female compared to male, young compared to old and low educated compared to high educated workers is employed in non-essential activities. When we look at the change in hirings and separations, from the 9th week of 2020 - the time when first cases and deaths due to COVID-19 were recorded -, we find a pronounced drop in hirings and endings of fixed-term contracts. Layoffs and quits increase after the 9th week, and then decline significantly, reflecting the effects of government intervention. The lifting of the lockdown triggers a slow recovery of labor market flows. Young workers, those on temporary contracts, low-educated workers, those employed in the South and those with no opportunities of working from home experience a greater decline in separation probability, indicating that government policy partly protected them from the labor market impact of the recession. The decline in the separation probability for women is lower than that for men.

Supplementary Information

The online version contains supplementary material available at 10.1007/s10888-021-09522-610.1007/s10888-021-09522-6.

Keywords: COVID-19, Hirings, Separations, Flows, Gender

Electronic supplementary material

Below is the link to the electronic supplementary material.

(PDF 91.2 KB) (91.2KB, pdf)

Acknowledgements

We would like to thank the associate editor, three anonymous referees, Bruno Anastasia, Giulia Bovini, Francesco D’Amuri, Domenico Depalo, Andrea Garnero and Christopher Rauh for useful comments and discussion. We are grateful to Gaetano Basso for providing data on the classification of occupations according to the opportunity of remote work. Salvatore Lattanzio gratefully acknowledges ESRC DTP Studentship (nr. ES/J500033/1) and Cambridge Commonwealth European and International Trust for financial support for PhD studies at the University of Cambridge. The views expressed in this article are those of the authors and are not the responsibility of the Bank of Italy or the Eurosystem.

Data Availability

The data we use are provided by the Ministry of Labor and Social Policy and can be accessed by sending a request through the modules provided at https://www.cliclavoro.gov.it/Barometro-Del-Lavoro/Pagine/Microdati-per-la-ricerca.aspx.

Declarations

Conflict of Interest

The authors declare no conflict of interest.

Footnotes

Publisher’s note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Contributor Information

Alessandra Casarico, Email: alessandra.casarico@unibocconi.it.

Salvatore Lattanzio, Email: salvatore.lattanzio@bancaditalia.it.

References

  1. Adamopoulou, E., De Philippis, M., Sette, E., Viviano, E.: The Long Run Earnings Effects of a Credit Market Disruption. IZA Discussion Papers 13185, Institute of Labor Economics (IZA) (2020)
  2. Adams-Prassl A, Boneva T, Golin M, Rauh C. Inequality in the impact of the coronavirus shock: evidence from real time surveys. J. Public Econ. 2020;189:104245. doi: 10.1016/j.jpubeco.2020.104245. [DOI] [Google Scholar]
  3. Alon T, Doepke M, Olmstead-Rumsey J, Tertilt M. The impact of COVID-19 on gender equality. Covid Econ. Vetted Real-Time Papers. 2020;4:62–85. [Google Scholar]
  4. Baker SR, Farrokhnia RA, Meyer S, Pagel M, Yannelis C. How does household spending respond to an epidemic? Consumption during the 2020 COVID-19 pandemic. Rev. Asset Pricing Stud. 2020;10(4):834–862. doi: 10.1093/rapstu/raaa009. [DOI] [Google Scholar]
  5. Basso, G., Boeri, T., Caiumi, A., Paccagnella, M.: Unsafe Jobs: Labour Market Risk and Social Protection. Economic Policy (2021)
  6. Belot M, Choi S, Tripodi E, Broek-Altenburg Evd, Jamison JC, Papageorge NW. Unequal consequences of Covid 19: representative evidence from six countries. Rev. Econ. Househ. 2021;19(3):769–783. doi: 10.1007/s11150-021-09560-z. [DOI] [PMC free article] [PubMed] [Google Scholar]
  7. Bick, A., Blandin, A.: Real Time Labor Market Estimates during the 2020 Coronavirus Outbreak. Unpublished Manuscript, Arizona State University (2020)
  8. Blundell R, Costa Dias M, Joyce R, Xu X. COVID-19 And inequalities. Fisc. Stud. 2020;41(2):291–319. doi: 10.1111/1475-5890.12232. [DOI] [PMC free article] [PubMed] [Google Scholar]
  9. Boeri, T., Ichino, A., Moretti, E., Posch, J.: Wage Equalization and Regional Misallocation: Evidence from Italian and German Provinces. Journal of the European Economic Association (2021)
  10. Bonacini L, Gallo G, Scicchitano S. Working from home and income inequality: risks of a ‘new normal’ with COVID-19. J. Popul. Econ. 2021;34(1):303–360. doi: 10.1007/s00148-020-00800-7. [DOI] [PMC free article] [PubMed] [Google Scholar]
  11. Cajner, T., Crane, L. D., Decker, R. A., Grigsby, J., Hamins-Puertolas, A., Hurst, E., Kurz, C., Yildirmaz, A.: The US Labor Market during the Beginning of the Pandemic Recession. Technical report, National Bureau of Economic Research (2020)
  12. Carvalho, V. M., Hansen, S., Ortiz, A., Ramón García, J., Rodrigo, T., Rodriguez Mora, S., Ruiz, J.: Tracking the COVID-19 Crisis with High-Resolution Transaction Data. CEPR Discussion Papers 14642, C.E.P.R. Discussion Papers (2020) [DOI] [PMC free article] [PubMed]
  13. Chetty, R., Friedman, J. N., Hendren, N., Stepner, M., et al.: How Did COVID-19 and Stabilization Policies Affect Spending and Employment? a New Real-Time Economic Tracker Based on Private Sector Data. Technical report, National Bureau of Economic Research (2020)
  14. Cortes, G. M., Forsythe, E. C.: The Heterogeneous Labor Market Impacts of the Covid-19 Pandemic. Upjohn Working Papers and Journal Articles 20-327, W.E. Upjohn Institute for Employment Research (2020)
  15. Crossley TF, Fisher P, Low H. The heterogeneous and regressive consequences of COVID-19: evidence from high quality panel data. J. Public Econ. 2021;193:104334. doi: 10.1016/j.jpubeco.2020.104334. [DOI] [PMC free article] [PubMed] [Google Scholar]
  16. Dingel, J. I., Neiman, B.: How many jobs can be done at home? J. Public Econ. 189, 104235 (2020) [DOI] [PMC free article] [PubMed]
  17. Farré, L., Fawaz, Y., Gonzalez, L., Graves, J.: How the COVID-19 Lockdown Affected Gender Inequality in Paid and Unpaid Work in Spain. IZA Discussion Papers 13434, Institute of Labor Economics (IZA) (2020)
  18. Forsythe E, Kahn LB, Lange F, Wiczer D. Labor demand in the time of COVID-19: Evidence from vacancy postings and UI claims. J. Public Econ. 2020;189:104238. doi: 10.1016/j.jpubeco.2020.104238. [DOI] [PMC free article] [PubMed] [Google Scholar]
  19. Galasso, V., Foucault, M.: Working during COVID-19. OECD Social Employment and Migration Working Papers 246 (2020)
  20. Garin, A., Silvério, F.: How Responsive are Wages to Demand within the Firm? Evidence from Idiosyncratic Export Demand Shocks. Technical report (2019)
  21. Hupkau C, Petrongolo B. Work, care and gender during the COVID-19 crisis. Fisc. Stud. 2020;41(3):623–651. doi: 10.1111/1475-5890.12245. [DOI] [PMC free article] [PubMed] [Google Scholar]
  22. IMF: World Economic Outlook Update. Report, Internation Monetary Fund (2021)
  23. INPS: Settori Essenziali Vs Settori Bloccati per La Crisi Pandemica: Un’analisi Dei Rapporti Di Lavoro Uniemens. Report, Istituto Nazionale di Previdenza Sociale (2020)
  24. Izquierdo, M., Jimeno, J. F., Kosma, T., Lamo, A., Millard, S., Rõõm, T., Viviano, E.: Labour Market adjustment in Europe during the crisis: microeconomic evidence from the Wage Dynamics Network survey Banco de Espana Occasional Paper (2017)
  25. Kugler A, Pica G. Effects of employment protection on worker and job flows: evidence from the 1990 Italian reform. Labour Econ. 2008;15(1):78–95. doi: 10.1016/j.labeco.2006.11.002. [DOI] [Google Scholar]
  26. OECD: OECD Employment Outlook 2020 (2020)
  27. Stantcheva, S.: Inequalities in the Times of a Pandemic. Economic Policy (2021)
  28. von Gaudecker, H. -M., Holler, R., Janys, L., Siflinger, B., Zimpelmann, C.: Labour Supply in the Early Stages of the Covid-19 Pandemic: Empirical Evidence on Hours, Home Office, and Expectations (2020)

Associated Data

This section collects any data citations, data availability statements, or supplementary materials included in this article.

Supplementary Materials

(PDF 91.2 KB) (91.2KB, pdf)

Data Availability Statement

The data we use are provided by the Ministry of Labor and Social Policy and can be accessed by sending a request through the modules provided at https://www.cliclavoro.gov.it/Barometro-Del-Lavoro/Pagine/Microdati-per-la-ricerca.aspx.

Articles from Journal of Economic Inequality are provided here courtesy of Nature Publishing Group

RESOURCES