Supply and demand shocks in the COVID-19 pandemic: An industry and occupation perspective
R. Maria del Rio-Chanona (),
François Lafond and
Papers from arXiv.org
We provide quantitative predictions of first order supply and demand shocks for the U.S. economy associated with the COVID-19 pandemic at the level of individual occupations and industries. To analyze the supply shock, we classify industries as essential or non-essential and construct a Remote Labor Index, which measures the ability of different occupations to work from home. Demand shocks are based on a study of the likely effect of a severe influenza epidemic developed by the US Congressional Budget Office. Compared to the pre-COVID period, these shocks would threaten around 22% of the US economy's GDP, jeopardise 24% of jobs and reduce total wage income by 17%. At the industry level, sectors such as transport are likely to have output constrained by demand shocks, while sectors relating to manufacturing, mining and services are more likely to be constrained by supply shocks. Entertainment, restaurants and tourism face large supply and demand shocks. At the occupation level, we show that high-wage occupations are relatively immune from adverse supply and demand-side shocks, while low-wage occupations are much more vulnerable. We should emphasize that our results are only first-order shocks -- we expect them to be substantially amplified by feedback effects in the production network.
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (187) Track citations by RSS feed
Downloads: (external link)
http://arxiv.org/pdf/2004.06759 Latest version (application/pdf)
Journal Article: Supply and demand shocks in the COVID-19 pandemic: an industry and occupation perspective (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:2004.06759
Access Statistics for this paper
More papers in Papers from arXiv.org
Bibliographic data for series maintained by arXiv administrators ().