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Labor Markets in Crisis: The Double Liability of Low‐Wage Work During COVID‐19

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  • Kourtney Koebel
  • Dionne Pohler

Abstract

We adopt a novel identification strategy to examine the heterogeneous effects of Canada’s COVID‐19 economic shutdown on hours worked across the earnings distribution. Early labor‐market analyses found that workers in the bottom of the earnings distribution experienced a much larger reduction in hours worked than workers in the top of the earnings distribution. Our analysis reveals a double liability of low‐wage work during Canada’s COVID‐19 economic shutdown: while workers in every quintile experienced a large reduction in hours on average, significant increases in hours were only present among workers in the bottom quintile. Implications for crisis income supports are discussed.

Suggested Citation

  • Kourtney Koebel & Dionne Pohler, 2020. "Labor Markets in Crisis: The Double Liability of Low‐Wage Work During COVID‐19," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 59(4), pages 503-531, October.
    • Handle: RePEc:bla:indres:v:59:y:2020:i:4:p:503-531
    DOI: 10.1111/irel.12269
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    References listed on IDEAS

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    1. Forsythe, Eliza & Kahn, Lisa B. & Lange, Fabian & Wiczer, David, 2020. "Labor demand in the time of COVID-19: Evidence from vacancy postings and UI claims," Journal of Public Economics, Elsevier, vol. 189(C).
    2. Louis-Philippe Beland & Oluwatobi Fakorede & Derek Mikola, 2020. "Short-Term Effect of COVID-19 on Self-Employed Workers in Canada," Canadian Public Policy, University of Toronto Press, vol. 46(S1), pages 66-81, July.
    3. Dingel, Jonathan I. & Neiman, Brent, 2020. "How many jobs can be done at home?," Journal of Public Economics, Elsevier, vol. 189(C).
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    RePEc Biblio mentions

    As found on the RePEc Biblio, the curated bibliography for Economics:
    1. > Economics of Welfare > Health Economics > Economics of Pandemics > Specific pandemics > Covid-19 > Economic consequences > Employment and Work

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    Cited by:

    1. Fang, Tony & Gunderson, Morley & Ha, Viet Hoang & Ming, Hui, 2025. "The Short-Term Effects of COVID-19 on Labour Market Outcomes of Recent Immigrants to Canada," IZA Discussion Papers 17756, IZA Network @ LISER.
    2. Fang, Tony & Gunderson, Morley & Ha, Viet Hoang & Ming, Hui, 2024. "Intersectional Analysis of the Labour Market Impacts of COVID: The Triple-Whammy of Females, Children, and Lower Skill," IZA Discussion Papers 17235, IZA Network @ LISER.

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