IDEAS home Printed from https://ideas.repec.org/a/bla/kyklos/v74y2021i4p512-526.html
   My bibliography  Save this article

Labor market effects of COVID‐19 in Sweden and its neighbors: Evidence from administrative data

Author

Listed:
  • Steffen Juranek
  • Jörg Paetzold
  • Hannes Winner
  • Floris Zoutman

Abstract

This paper studies the labor market effects of non‐pharmaceutical interventions (NPIs) to combat the COVID‐19 pandemic. We focus on the Nordic countries which showed one of the highest variations in NPIs despite having similar community spread of COVID‐19 at the onset of the pandemic: While Denmark, Finland and Norway imposed strict measures (‘lockdowns’), Sweden decided for much lighter restrictions. Empirically, we use novel administrative data on weekly new unemployment and furlough spells from all 56 regions of the Nordic countries to compare the labor market outcomes of Sweden with the ones of its neighbors. Our evidence suggests that the labor markets of all countries were severely hit by the pandemic, although Sweden performed slightly better than its neighbors. Specifically, we find the worsening of the Swedish labor market to occur around 2 to 3 weeks later than in the other Nordic countries, and that its cumulative sum of new unemployment and furlough spells remained significantly lower (about 20–25%) during the time period of our study (up to week 21 of 2020).

Suggested Citation

  • Steffen Juranek & Jörg Paetzold & Hannes Winner & Floris Zoutman, 2021. "Labor market effects of COVID‐19 in Sweden and its neighbors: Evidence from administrative data," Kyklos, Wiley Blackwell, vol. 74(4), pages 512-526, November.
    • Handle: RePEc:bla:kyklos:v:74:y:2021:i:4:p:512-526
    DOI: 10.1111/kykl.12282
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/kykl.12282
    Download Restriction: no
    File URL: https://libkey.io/10.1111/kykl.12282?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Ulrich Glogowsky & Emanuel Hansen & Simeon Schächtele, 2021. "How effective are social distancing policies? Evidence on the fight against COVID-19," PLOS ONE, Public Library of Science, vol. 16(9), pages 1-12, September.
    2. Kong, Edward & Prinz, Daniel, 2020. "Disentangling policy effects using proxy data: Which shutdown policies affected unemployment during the COVID-19 pandemic?," Journal of Public Economics, Elsevier, vol. 189(C).
    3. Kyyrä, Tomi & Pesola, Hanna & Rissanen, Aarne, 2017. "Unemployment Insurance in Finland: A Review of Recent Changes and Empirical Evidence on Behavioral Responses," Research Reports 184, VATT Institute for Economic Research.
    4. Zhixian Lin & Christopher M. Meissner, 2020. "Health vs. Wealth? Public Health Policies and the Economy During Covid-19," NBER Working Papers 27099, National Bureau of Economic Research, Inc.
    5. 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).
    6. Jonung, Lars, 2020. "Sweden's Constitution Decides Its Covid-19 Exceptionalism," Working Papers 2020:11, Lund University, Department of Economics.
    7. Browning, Martin & Heinesen, Eskil, 2012. "Effect of job loss due to plant closure on mortality and hospitalization," Journal of Health Economics, Elsevier, vol. 31(4), pages 599-616.
    8. Sumedha Gupta & Laura Montenovo & Thuy Nguyen & Felipe Lozano‐Rojas & Ian Schmutte & Kosali Simon & Bruce A. Weinberg & Coady Wing, 2023. "Effects of social distancing policy on labor market outcomes," Contemporary Economic Policy, Western Economic Association International, vol. 41(1), pages 166-193, January.
    9. Annette Alstadsæter & Bernt Bratsberg & Gaute Eielsen & Wojciech Kopczuk & Simen Markussen & Oddbjorn Raaum & Knut Røed, 2020. "The First Weeks of the Coronavirus Crisis: Who Got Hit, When and Why? Evidence from Norway," NBER Working Papers 27131, National Bureau of Economic Research, Inc.
    10. Annette Alstadsæter & Julie Brun Bjørkheim & Wojciech Kopczuk & Andreas Økland, 2020. "Norwegian and U.S. Policies Alleviate Business Vulnerability Due to the COVID-19 Shock Equally Well," National Tax Journal, National Tax Association;National Tax Journal, vol. 73(3), pages 805-828, September.
    11. Steffen Juranek & Floris Zoutman, 2020. "The Effect of Social Distancing Measures on the Demand for Intensive Care: Evidence on Covid-19 in Scandinavia," CESifo Working Paper Series 8262, CESifo.
    12. Juranek, Steffen & Zoutman, Floris T., 2020. "The Effect of Social Distancing Measures on Intensive Care Occupancy: Evidence on COVID-19 in Scandinavia," Discussion Papers 2020/2, Norwegian School of Economics, Department of Business and Management Science.
    13. Benjamin Born & Alexander M Dietrich & Gernot J Müller, 2021. "The lockdown effect: A counterfactual for Sweden," PLOS ONE, Public Library of Science, vol. 16(4), pages 1-13, April.
    14. Sang-Wook (Stanley) Cho, 2020. "Quantifying the impact of nonpharmaceutical interventions during the COVID-19 outbreak: The case of Sweden," The Econometrics Journal, Royal Economic Society, vol. 23(3), pages 323-344.
    15. Ho Fai Chan & Ahmed Skali & David Savage & David Stadelmann & Benno Torgler, 2020. "Risk Attitudes and Human Mobility During the COVID-19 Pandemic," CREMA Working Paper Series 2020-06, Center for Research in Economics, Management and the Arts (CREMA).
    16. Bennedsen, Morten & Larsen, Birthe & Schmutte, Ian & Scur, Daniela, 2020. "Preserving job matches during the COVID-19 pandemic: firm-level evidence on the role of government aid," GLO Discussion Paper Series 588, Global Labor Organization (GLO).
    17. Baek, ChaeWon & McCrory, Peter B & Messer, Todd & Mui, Preston, 2020. "Unemployment Effects of Stay-at-Home Orders: Evidence from High Frequency Claims Data," Institute for Research on Labor and Employment, Working Paper Series qt042177j7, Institute of Industrial Relations, UC Berkeley.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Fazio, Andrea & Reggiani, Tommaso & Sabatini, Fabio, 2022. "The political cost of sanctions: Evidence from COVID-19," Health Policy, Elsevier, vol. 126(9), pages 872-878.
    2. Dubois, Corinne & Lambertini, Luisa & Wu, Yu, 2022. "Gender Effects of the Covid-19 Pandemic in the Swiss Labor Market," FSES Working Papers 525, Faculty of Economics and Social Sciences, University of Freiburg/Fribourg Switzerland.
    3. Jessica Carrick-Hagenbarth & Eric Edlund & Avanti Mukherjee, 2023. "Analysis of Hybrid Epidemiological-Economic Models of COVID-19 Mitigation Policies," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 49(4), pages 585-612, October.
    4. Zarifhonarvar, Ali, 2022. "A Survey on the Impact of Covid-19 on the Labor Market," EconStor Preprints 265549, ZBW - Leibniz Information Centre for Economics.
    5. Rihab Baltaji & Ali Fakih & Nagham Sayour, 2023. "How did COVID‐19 lockdowns affect firms and workers? Evidence from Jordan and Morocco," Development Policy Review, Overseas Development Institute, vol. 41(6), November.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Abel Brodeur & David Gray & Anik Islam & Suraiya Bhuiyan, 2021. "A literature review of the economics of COVID‐19," Journal of Economic Surveys, Wiley Blackwell, vol. 35(4), pages 1007-1044, September.
    2. Juranek, Steffen & Paetzold, Jörg & Winner, Hannes & Zoutman, Floris T., 2020. "Labor Market Effects of COVID-19 in Sweden and its Neighbors: Evidence from Novel Administrative Data," Discussion Papers 2020/8, Norwegian School of Economics, Department of Business and Management Science.
    3. Steffen Juranek & Floris T. Zoutman, 2021. "The effect of non-pharmaceutical interventions on the demand for health care and on mortality: evidence from COVID-19 in Scandinavia," Journal of Population Economics, Springer;European Society for Population Economics, vol. 34(4), pages 1299-1320, October.
    4. Callaway, Brantly & Li, Tong, 2023. "Policy evaluation during a pandemic," Journal of Econometrics, Elsevier, vol. 236(1).
    5. Sumedha Gupta & Kosali I. Simon & Coady Wing, 2020. "Mandated and Voluntary Social Distancing During The COVID-19 Epidemic: A Review," NBER Working Papers 28139, National Bureau of Economic Research, Inc.
    6. Nicola Raimo & Pedro-José Martínez-Córdoba & Bernardino Benito & Filippo Vitolla, 2021. "The Impact of the COVID-19 Pandemic on the Labor Market: An Analysis of Supply and Demand in the Spanish Municipalities," Sustainability, MDPI, vol. 13(23), pages 1-12, November.
    7. Gopi Shah Goda & Emilie Jackson & Lauren Hersch Nicholas & Sarah See Stith, 2023. "The impact of Covid-19 on older workers’ employment and Social Security spillovers," Journal of Population Economics, Springer;European Society for Population Economics, vol. 36(2), pages 813-846, April.
    8. Bisin, Alberto & Moro, Andrea, 2022. "Spatial‐SIR with network structure and behavior: Lockdown rules and the Lucas critique," Journal of Economic Behavior & Organization, Elsevier, vol. 198(C), pages 370-388.
    9. Kong, Edward & Prinz, Daniel, 2020. "Disentangling policy effects using proxy data: Which shutdown policies affected unemployment during the COVID-19 pandemic?," Journal of Public Economics, Elsevier, vol. 189(C).
    10. Allen Bellas & Lea-Rachel Kosnik, 2023. "The Local and Aggregated Impacts of Stay-at-Home Orders on State Level Unemployment Outcomes," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 49(2), pages 142-155, April.
    11. Alexander W. Bartik & Marianne Bertrand & Feng Lin & Jesse Rothstein & Matthew Unrath, 2020. "Measuring the Labor Market at the Onset of the COVID-19 Crisis," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 51(2 (Summer), pages 239-268;316.
    12. Leonardo Fabio Morales & Leonardo Bonilla‐Mejía & Jose Pulido & Luz A. Flórez & Didier Hermida & Karen L. Pulido‐Mahecha & Francisco Lasso‐Valderrama, 2022. "Effects of the COVID‐19 pandemic on the Colombian labour market: Disentangling the effect of sector‐specific mobility restrictions," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 55(S1), pages 308-357, February.
    13. Shenoy, Ajay & Sharma, Bhavyaa & Xu, Guanghong & Kapoor, Rolly & Rho, Haedong Aiden & Sangha, Kinpritma, 2022. "God is in the rain: The impact of rainfall-induced early social distancing on COVID-19 outbreaks," Journal of Health Economics, Elsevier, vol. 81(C).
    14. Mario J. Crucini & Oscar O'Flaherty, 2020. "Stay-at-Home Orders in a Fiscal Union," NBER Working Papers 28182, National Bureau of Economic Research, Inc.
    15. Christian Dreger & Daniel Gros, 2021. "Lockdowns and the US Unemployment Crisis," Economics of Disasters and Climate Change, Springer, vol. 5(3), pages 449-463, October.
    16. Miriam Marcén & Marina Morales, 2021. "The intensity of COVID‐19 nonpharmaceutical interventions and labor market outcomes in the public sector," Journal of Regional Science, Wiley Blackwell, vol. 61(4), pages 775-798, September.
    17. Bisin, Alberto & Moro, Andrea, 2022. "JUE insight: Learning epidemiology by doing: The empirical implications of a Spatial-SIR model with behavioral responses," Journal of Urban Economics, Elsevier, vol. 127(C).
    18. Akos Horvath & Benjamin S. Kay & Carlo Wix, 2021. "The COVID-19 Shock and Consumer Credit: Evidence from Credit Card Data," Finance and Economics Discussion Series 2021-008, Board of Governors of the Federal Reserve System (U.S.).
    19. Germain Gauthier, 2021. "On the Use of Two-Way Fixed Effects Models for Policy Evaluation During Pandemics," Papers 2106.10949, arXiv.org.
    20. Fezzi, Carlo & Fanghella, Valeria, 2021. "Tracking GDP in real-time using electricity market data: Insights from the first wave of COVID-19 across Europe," European Economic Review, Elsevier, vol. 139(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:kyklos:v:74:y:2021:i:4:p:512-526. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0023-5962 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.