The heterogeneous effects of COVID-19 on labor markets: People’s movement and non-pharmaceutical interventions

Kisho Hoshi, Hiroyuki Kasahara, Ryo Makioka, Michio Suzuki and Satoshi Tanaka

Journal of the Japanese and International Economies, 2022, vol. 63, issue C

Abstract: The paper investigates the heterogeneous effect of a policy-induced decline in people’s mobility on the Japanese labor market outcome during the early COVID-19 period. Regressing individual-level labor market outcomes on prefecture-level mobility changes using policy stringency index as an instrument, our two-stage least squares estimator presents the following findings. First, the number of people absent from work increased for all groups of individuals, but the magnitude was greater for workers with non-regular employment status, low-educated people, females especially with children, and those aged 31 to 45 years. Second, while work hours decreased for most groups, the magnitude was especially greater for business owners without employees and those aged 31 to 45. Third, the negative effect on unemployment was statistically significant for older males who worked as regular workers in the previous year. The impact was particularly considerable for those aged 60 and 65, thus suggesting that they lost their re-employment opportunity due to COVID-19. Fourth, all these adverse effects were greater for people working in service and sales occupations. Fifth, a counterfactual experiment of more stringent policies indicates that while an average worker would lose JPY 3857 in weekly earnings by shortening their work hours, the weekly loss for those aged 31 to 45 years and working in service and sales occupations would be about JPY 13,842.

Keywords: COVID-19; Inequality; Short-time work; Working from home; Behavior (search for similar items in EconPapers)
JEL-codes: E24 J23 J26 J31 J63 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Working Paper: The Heterogeneous Effects of COVID-19 on Labor Markets: People's Movement and Non-Pharmaceutical Interventions (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jjieco:v:63:y:2022:i:c:s0889158321000496

DOI: 10.1016/j.jjie.2021.101170

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