Austria’s labor market during the COVID-19 crisis

Christian Ragacs and Lukas Reiss ()
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Lukas Reiss: Oesterreichische Nationalbank, Economic Analysis Division

Monetary Policy & the Economy, 2021, issue Q2/21, 59-78

Abstract: The impact of the COVID-19 crisis on Austria’s labor market has been huge and a lot heavier than during the Great Recession of 2009 in terms of the increase in unemployment and the drop in employment. Key metrics show that the decrease in employment was broadly in line with the euro area average and that the increase in unemployment went hand with an increase in long-term unemployment and the average duration of unemployment. The generous short-time work scheme rolled out by the government prevented a turn for the worse and also lessened the downward pressure on average wages induced by the strong decrease in average hours worked per employee in 2020. While manufacturing or construction were hit as well, the tourism industry was affected most by the crisis, contributing to a relatively stronger increase in unemployment in provinces with a higher tourism-related share of employment. Younger employees and especially foreigners were also relatively more affected by the increase in unemployment, while employees with tertiary education were relatively less affected. Labor supply, while losing momentum, did continue to grow in 2020, while it had stagnated during the Great Recession.

Keywords: COVID-19; labor market; recession; public policy (search for similar items in EconPapers)
JEL-codes: E32 H2 J2 J3 (search for similar items in EconPapers)
Date: 2021
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