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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 has also published several Discussion Papers on Covid-19. Here is a selection:

Further Discussion Papers on this topic can be found on the IZA's Publications page. 

IZA World of Labor content:
 

  • 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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  • The relationship between recessions and health

    Economic recessions seem to reduce overall mortality rates, but increase suicides and mental health problems

    Nick Drydakis, August 2016
    Recessions are complex events that affect personal health and behavior via various potentially opposing mechanisms. While recessions are known to have negative effects on mental health and lead to an increase in suicides, it has been proven that they reduce mortality rates. A general health policy agenda in relation to recessions remains ambiguous due to the lack of consistency between different individual- and country-level approaches. However, aggregate regional patterns provide valuable information, and local social planners could use them to design region-specific policy responses to mitigate the negative health effects cause by recessions.
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