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Economic Shocks and Worker Careers: Has the COVID-19 Pandemic Affected Transitions Out of Unemployment?

Author

Listed:
  • Buhmann, Mara

    (Institute for Employment Research (IAB), Nuremberg)

  • Pohlan, Laura

    (Institute for Employment Research (IAB), Nuremberg)

  • Roth, Duncan H.W.

    (Institute for Employment Research (IAB), Nuremberg)

Abstract

Temporary economic shocks can have enduring effects on individuals and their career trajectories. This paper investigates the labour market effects of the Covid- 19 pandemic on newly unemployed individuals, the underlying mechanisms as well as occupation-specific effect heterogeneity. The results indicate long-lasting earnings losses due to the pandemic, which can be explained by a decline in employment in the short run and a decline in wages in the longer run. We further find that the lower the lockdown work ability of a worker's previous occupation, the greater the adverse effects of the pandemic.

Suggested Citation

  • Buhmann, Mara & Pohlan, Laura & Roth, Duncan H.W., 2024. "Economic Shocks and Worker Careers: Has the COVID-19 Pandemic Affected Transitions Out of Unemployment?," IZA Discussion Papers 17268, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp17268
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    References listed on IDEAS

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    1. Jonah B. Gelbach, 2016. "When Do Covariates Matter? And Which Ones, and How Much?," Journal of Labor Economics, University of Chicago Press, vol. 34(2), pages 509-543.
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    4. Palomino, Juan C. & Rodríguez, Juan G. & Sebastian, Raquel, 2020. "Wage inequality and poverty effects of lockdown and social distancing in Europe," European Economic Review, Elsevier, vol. 129(C).
    5. Laura K. Gee, 2019. "The More You Know: Information Effects on Job Application Rates in a Large Field Experiment," Management Science, INFORMS, vol. 67(5), pages 2077-2094, May.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    economic shocks; COVID-19; unemployment; worker careers; occupations;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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