COVID-19: how much unemployment was caused by the shutdown in Germany?

Anja Bauer and Enzo Weber

Applied Economics Letters, 2021, vol. 28, issue 12, 1053-1058

Abstract: This paper evaluates the short-term labour market impact of the COVID-19 containment measures in Germany. By assessing the treatment effect on unemployment via difference-in-difference estimation, we find that 60% of the considerably increased inflows from employment into unemployment in April 2020 were due to the shutdown measures. Disentangling further, we find that the hiring margin accounted for additional 82% of the unemployment effect coming from the separations margin. In sum, the shutdown measures increased unemployment in the short run by 117,000 persons.

Date: 2021
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DOI: 10.1080/13504851.2020.1789544

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