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Labour market flexibility as a factor in economic recovery after the COVID-19 pandemic

Author

Listed:
  • Maria Ye. Konovalova

    (Samara State University of Economics, Samara, Russia)

  • Oksana V. Plyusnina

    (Ukhta State Technical University, Ukhta, the Komi Republic, Russia)

  • Elena V. Fedotova

    (Kaluga branch of the Russian State Agrarian University – Moscow Timiryazev Agricultural Academy, Kaluga, Russia)

Abstract

The COVID-19 pandemic has largely undermined most economies in the world. To a significant extent the reasons behind this economic nosedive are rooted in the sphere of labour market. The imposed restriction measures made many workers stay at home, and part of them even lost their jobs. The speed of economic recovery in different countries varied depending on how quarantine restrictions were eased. One crucial factor in this process is labour market flexibility and its ability to adapt to changing economic conditions. The purpose of the paper is to explore the relationship between the labour market flexibility and the speed of GDP recovery when the pandemic was waning and the quarantine restrictions were being removed. Methodologically, the study relies on labour economics. The methods are multivariate and logistic regression analysis. The data for the study is sourced from the World Bank and Eurostat and comprises statistics for assessing labour market flexibility and GDP in various countries for 2020–2021. The findings indicate a reverse relationship between the speed of GDP growth recovery during the post-COVID period and the share of part-time employment. Yet taking into account that part-time employment is not only an indicator of the labour market flexibility, but also reflects a general slowdown in production and unemployment, we can attach low speed of recovery to a greater weakness of an economy. The obtained results are insufficient to reject the hypothesis that a more flexible labour market accelerates the recovery of a national economy. At the same time, the study demonstrates that the West European countries generally got over the consequences of the COVID-19 crisis faster than other EU countries. The research contributes to understanding the transformation processes in the labour market under the pandemic as well as provides support for labour market policy development and implementation.

Suggested Citation

  • Maria Ye. Konovalova & Oksana V. Plyusnina & Elena V. Fedotova, 2023. "Labour market flexibility as a factor in economic recovery after the COVID-19 pandemic," Journal of New Economy, Ural State University of Economics, vol. 24(4), pages 64-81, January.
    • Handle: RePEc:url:izvest:v:24:y:2023:i:4:p:64-81
    DOI: 10.29141/2658-5081-2023-24-4-4
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    References listed on IDEAS

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    More about this item

    Keywords

    labour market; labour market flexibility; part-time employment; GDP; pandemic; the European Union;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O21 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Planning Models; Planning Policy

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