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The Pandemic Push: Digital Technologies and Workforce Adjustments

Author

Listed:
  • Gathmann, Christina
  • Kagerl, Christian
  • Pohlan, Laura
  • Roth, Duncan

Abstract

Based on a unique survey and administrative employer-employee data, we show that the COVID-19 pandemic acted as a push factor for the diffusion of digital technologies in Germany. About two in three firms invested in digital technologies, in particular in hardware and software to enable decentralized communication, management and coordination. The investments encouraged additional firm-sponsored training despite pandemic-related restrictions indicating that investments in digital technologies and training are complements. We then demonstrate that the additional investments helped firms to insure workers against the downturn during the pandemic. Firms that made additional investments relied less on short-time work, had more of their regular employees working normal hours and had to lay off fewer marginal workers. Male, younger and medium-skilled workers benefitted the most from the insurance effect of digital investments.

Suggested Citation

  • Gathmann, Christina & Kagerl, Christian & Pohlan, Laura & Roth, Duncan, 2023. "The Pandemic Push: Digital Technologies and Workforce Adjustments," CEPR Discussion Papers 18097, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:18097
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    2. Simone Schüller, 2025. "Estimating the Effect of Working from Home on Parents' Division of Childcare and Housework: A New Panel IV Approach," CESifo Working Paper Series 11689, CESifo.
    3. Arntz, Melanie & Böhm, Michael & Graetz, Georg & Gregory, Terry & Lehmer, Florian & Lipowski, Cäcilia, 2024. "Firm-level technology adoption in times of crisis," ZEW Discussion Papers 24-057, ZEW - Leibniz Centre for European Economic Research.
    4. Zhang, Su & Xia, Yan & Wang, Huijuan & Pan, Jiaofeng, 2025. "The good, the bad: How digital technology shapes welfare for formal and flexible workers?," Economic Analysis and Policy, Elsevier, vol. 85(C), pages 2007-2029.
    5. Sarra Ben Yahmed & Francesco Berlingieri & Eduard Brüll, 2025. "Local Labour Market Resilience: The Role of Digitalisation and Working From Home," Journal of Regional Science, Wiley Blackwell, vol. 65(5), pages 1506-1532, November.
    6. Dale-Olsen, Harald & Finseraas, Henning & Nergaard, Kristine & Svarstad, Elin, 2025. "Upholding Unions – How Colleagues Shape Union Membership?," IZA Discussion Papers 18139, Institute of Labor Economics (IZA).
    7. Fabian Kosse & Tim Leffler & Arna Woemmel, 2025. "Digital Skills: Social Disparities and the Impact of Early Mentoring," SOEPpapers on Multidisciplinary Panel Data Research 1222, DIW Berlin, The German Socio-Economic Panel (SOEP).
    8. Filippo Boeri & Riccardo Crescenzi & Davide Rigo, 2025. "Work from Home and Firm Productivity: The Role of ICT and Size," CESifo Working Paper Series 12253, CESifo.
    9. Christoph Müller, 2024. "The COVID-19 pandemic and firms’ E-learning use: implications for inequality in training opportunities," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 58(1), pages 1-15, December.
    10. Bachmann, Ronald & Storm, Eduard, 2024. "Wie groß ist die Gefahr eines Fachkräftemangels in Zukunftsberufen? Evidenz für deutsche Metropolregionen," RWI Materialien 166, RWI - Leibniz-Institut für Wirtschaftsforschung.
    11. Mühlemann, Samuel, 2024. "AI Adoption and Workplace Training," IZA Discussion Papers 17367, Institute of Labor Economics (IZA).
    12. Anne Otto & Sebastian Losacker & Hendrik Hansmeier, 2025. "Relatedness, complexity, and regional development paths in Germany: a sequencing approach," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 74(2), pages 1-26, June.
    13. Fabian Kosse & Tim Leffler & Arna Woemmel, 2024. "Digital Skills: Social Disparities and the Impact of Early Mentoring," CESifo Working Paper Series 11570, CESifo.
    14. Gaetano Basso & Davide Dottori & Sara Formai, 2025. "Working from home and labour productivity: firm-level evidence," Temi di discussione (Economic working papers) 1508, Bank of Italy, Economic Research and International Relations Area.
    15. Bachmann, Ronald & Gonschor, Myrielle & Storm, Eduard & Evans, Julian, 2024. "Berufe der Zukunft im Ruhrgebiet: Studie im Auftrag des Regionalverbands Ruhr. Endbericht," RWI Projektberichte, RWI - Leibniz-Institut für Wirtschaftsforschung, number 296884.
    16. Mantej Pardesi, 2025. "Technology spikes and skill formation adjustment: Role of capital investment spikes in firm's training and hiring decision," Economics of Education Working Paper Series 0249, University of Zurich, Department of Business Administration (IBW).

    More about this item

    Keywords

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    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs

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