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Covid-19—Pandemics and the labor market

We are facing unprecedented times as the coronavirus—or “Covid-19,” the disease associated with the virus—pandemic sweeps the globe. In the short term this means extreme disruption for citizens and labor markets as countries impose travel restrictions and nationwide lockdowns to slow the spread of the virus and prevent it from overwhelming health services. Governments are having to find extraordinary ways to protect workers and their economies from financial hardship and potential collapse. Recession would appear to be inevitable. Citizens themselves are also experiencing exceptional limits on their movements, which could have overwhelming effects on their health and well-being. But the full effects of the crisis are as yet unknown and may take many years of analysis before they are fully understood. 

IZA Discussion Papers:
IZA publishes a series of Discussion Papers on Covid-19. Here is a selection of the latest:

Visit IZA's COVID-19 and the Labor Market site for further content on the pandemic.

See National responses to Covid-19 for a compilation of content looking at the effects of the pandemic on individual countries or cities. 

IZA World of Labor content:

  • Digital leadership: Motivating online workers

    Which leadership techniques and tools should digital leaders use to communicate effectively with remote teams and gig workers?

    Petra Nieken, September 2022
    Remote work and digital collaborations are prevalent in the business world and many employees use digital communication tools routinely in their jobs. Communication shifts from face-to-face meetings to asynchronous formats using text, audio, or video messages. This shift leads to a reduction of information and signals leaders can send and receive. Do classical leadership and communication techniques such as transformational or charismatic leadership signaling still work in those online settings or do leaders have to rely on transactional leadership techniques such as contingent reward and punishment tools in the remote setting?
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  • The labor market in New Zealand, 2000−2021 Updated

    Employment has grown steadily, unemployment is low, and the gender gap and skill premiums have fallen

    David C. Maré, August 2022
    New Zealand is a small open economy, with large international labor flows and skilled immigrants. After the global financial crisis (GFC) employment took four years to recover, while unemployment took more than a decade to return to pre-crisis levels. Māori, Pasifika, and young workers were worst affected. The Covid-19 pandemic saw employment decline and unemployment rise but this was reversed within a few quarters. However, the long-term impact of the pandemic remains uncertain.
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  • The labor market impact of Covid-19 on immigrants

    Job loss from Covid-19 was greater among immigrants than the native-born in most developed countries

    Hugh Cassidy, February 2022
    The labor market disruptions due to the Covid-19 pandemic and lockdowns impacted immigrant workers more severely than native-born workers in the US, Canada, Australia, and most EU countries. Immigrant workers in most of these countries were more vulnerable to the pandemic since they were more likely to be employed in jobs that are not as easy to perform remotely. The labor market recovery for both groups in the US was rapid, and by Fall 2020, the employment gaps between immigrant and native-born workers, both for men and women, had returned to pre-pandemic levels.
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  • The transformations of the French labor market, 2000–2021 Updated

    The workforce is now much better educated, but crises have magnified unemployment, underemployment, and low-income work

    Philippe Askenazy, February 2022
    France has the second largest population of countries in the EU. Since 2000, the French labor market has undergone substantial changes resulting from striking trends, some of which were catalyzed by the Great Recession and the Covid-19 crisis. The most interesting of these changes have been the massive improvement in the education of the labor force (especially of women), the resilience of employment during recessions, and the dramatic emergence of very-short-term employment contracts (less than a week) and low-income independent contractors, which together have fueled earnings inequality.
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  • Health effects of job insecurity Updated

    Job insecurity adversely affects health, but employability policies and otherwise better job quality can mitigate the effects

    Francis Green, December 2020
    The fear of unemployment has increased around the world in the wake of Covid-19. Research has shown that job insecurity affects both mental and physical health, though the effects are lower when employees are easily re-employable. The detrimental effects of job insecurity could be partly mitigated if employers improved other aspects of job quality that support better health. But as job insecurity is felt by many more people than just the unemployed, the negative health effects during recessions are multiplied and extend through the majority of the population. This reinforces the need for effective, stabilising macroeconomic policies, most especially at this time of pandemic.
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  • Short-time work compensation schemes and employment Updated

    Temporary government schemes can have a positive economic effect

    Pierre Cahuc, May 2019
    Government schemes that compensate workers for the loss of income while they are on short hours (known as short-time work compensation schemes) make it easier for employers to temporarily reduce hours worked so that labor is better matched to output requirements. Because the employers do not lay off these staff, the schemes help to maintain permanent employment levels during recessions. However, they can create inefficiency in the labor market, and might limit labor market access for freelancers and those looking to work part-time.
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