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Who Suffers from the COVID-19 Shocks? Labor Market Heterogeneity and Welfare Consequences in Japan (Forthcoming in the Journal of the Japanese and the International Economies)

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  • Shinnosuke Kikuchi

    (Massachusetts Institute of Technology)

  • Sagiri Kitao

    (University of Tokyo)

  • Minamo Mikoshiba

    (University of Tokyo)

Abstract

Effects of the COVID-19 shocks in the Japanese labor market vary across people of different age groups, genders, employment types, education levels, occupations, and industries. We document heterogeneous changes in employment and earnings in response to the COVID-19 shocks, observed in various data sources during the initial months after onset of the pandemic in Japan. We then feed these shocks into a life-cycle model of heterogeneous agents to quantify welfare consequences of the COVID-19 shocks. In each dimension of the heterogeneity, the shocks are amplified for those who earned less prior to the crisis. Contingent workers are hit harder than regular workers, younger workers than older workers, females than males, and workers engaged in social and non-flexible jobs than those in ordinary and flexible jobs. The most severely hurt by the COVID-19 shocks has been a group of female, contingent, low-skilled workers, engaged in social and non-flexible jobs and without a spouse of a different group.

Suggested Citation

  • Shinnosuke Kikuchi & Sagiri Kitao & Minamo Mikoshiba, 2020. "Who Suffers from the COVID-19 Shocks? Labor Market Heterogeneity and Welfare Consequences in Japan (Forthcoming in the Journal of the Japanese and the International Economies)," CARF F-Series CARF-F-490, Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo.
    • Handle: RePEc:cfi:fseres:cf490
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    References listed on IDEAS

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    1. Makoto Nirei & Nao Sudo, 2020. "Necessities, Home Production, and Economic Impacts of Stay-at-Home Policies," IMES Discussion Paper Series 20-E-14, Institute for Monetary and Economic Studies, Bank of Japan.

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