An evaluation of the Paycheck Protection Program using administrative payroll microdata

David Autor, David Cho, Leland Crane, Mita Goldar, Byron Lutz, Joshua Montes, William Peterman, David Ratner, Daniel Villar and Ahu Yildirmaz

Journal of Public Economics, 2022, vol. 211, issue C

Abstract: The Paycheck Protection Program (PPP), a principal element of the fiscal stimulus enacted by Congress in response to the COVID-19 economic shock, was intended to assist small businesses to maintain employment and wages during the crisis, as well as cover other expenses. We use high-frequency administrative payroll data from ADP—one of the world’s largest payroll processing firms—to estimate the causal effect of the PPP on the evolution of employment at PPP-eligible firms relative to PPP-ineligible firms, where eligibility is determined by industry-specific firm-size cutoffs. Our estimates indicate that the PPP boosted employment at eligible firms by between 2 percent to 5 percent at its peak effect around mid-May 2020. The boost to employment waned thereafter and ranged from no effect to a 3 percent boost at the end of 2020. Our estimates imply that employers retained an additional 3.6 million jobs as of mid-May 2020, and 1.4 million jobs at the end of 2020, as a consequence of PPP. The estimated cost per year of employment retained was $169,000 to $258,000, equal to 3.4 to 5.2 times median earnings.

Keywords: Paycheck Protection Program; COVID-19; Fiscal Policy (search for similar items in EconPapers)
JEL-codes: E24 H25 H32 H81 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0047272722000664
Full text for ScienceDirect subscribers only

Related works:
Working Paper: An Evaluation of the Paycheck Protection Program Using Administrative Payroll Microdata (2022)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:pubeco:v:211:y:2022:i:c:s0047272722000664

DOI: 10.1016/j.jpubeco.2022.104664

Access Statistics for this article

Journal of Public Economics is currently edited by R. Boadway and J. Poterba

More articles in Journal of Public Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().