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BIA-Brukerstyrt innovasjonsarena

LabRec - Labor Demand in Crisis and Recovery

Alternative title: Etterspørselen etter arbeidskraft gjennom krise og oppgang

Awarded: NOK 5.0 mill.

Project Number:

316599

Project Period:

2020 - 2022

Funding received from:

Location:

Partner countries:

This project aims at studying changes in labor demand during the corona crisis and beyond. The first part of the project starts out by tracking changes in job vacancy postings based on data from The Norwegian Labour and Welfare Administration (NAV). We compare the developments in labor demand for different occupations, in different regions and industries in 2020 with the same months from 2018 and 2019. In addition to mapping the general picture for the development in job vacancies in during the first half year of the pandemic, we will have a particular focus on vacancies in occupations that are important for young workers, and on training and qualification requirements of the new jobs. During the initial lock-down in March 2020 unemployment surged. At the same time job-postings plunged. We use all 650 000 job-postings published during 2018, 2019 and 2020 in order to compare the situation during the pandemic to the situation before the pandemic. The results gives reason to worry about the long term consequences for «generation Covid», i.e. youth who completed their education right before or during the pandemic, in particular for those with lower education. Four weeks in to the pandemic 300000 new unemployed registered with the national employment agency (NAV) either as furloughed or as unemployed. At the same time there was a decline of 40 percent in new job-postings. The steep decline was followed by a slow and incomplete catch up the during the remaining months of 2020. By the end of 2020, the number of new job-postings was 8-10 percent lower than for the same period before the pandemic. The impact was even stronger for young people below 26 years of age. We looked particularly at the 20 most important occupations for youth, comprising three fourth of young workers, and including sales-workers, health assistants, kindergarten-assistants and bartenders. In April 2020 job postings were 63 percent lower than in the previous years. All in all, young workers saw a more volatile job market than other groups. They were harder hit, but also bounced back more rapidly. By the end of 2020 job postings were 23 percent lower than in earlier years. There are signs of increasing tightness in the labor market. We are currently measuring the development in a tightness indicator that accounts for both vacancies relative to unemployment and the number of workers on furlough. We have also started the work with comparing the development of job-postings and hires between countries during the pandemic.

The project consists of three work packages: In the first work package, we start out by tracking changes in job vacancy postings, hires, separations and job growth following the outbreak of COVID 19. We compare the trajectories from 2020, to pre-crisis observations from the same months from 2018 and 2019, by occupations, industries, and regions. These analyses will be in “real-time” drawing monthly data at half- or yearly intervals from the fall of 2020. We follow both online job vacancy postings, hires, separations and job growth. The focus in the initial phase will be to study the development of occupations, industries, and regions that are most likely to be affected by the political measures and behavioral responses by individuals and firms, with characteristics such as direct human contact, travel and transport dependency, conditions for home- and teleworking etc. In the next phase it will be important to identify spillover effects to other industries and occupations, and the responses to new challenges in the aftermath of the pandemic, such as likely drops in domestic and international demands, broken international value chains, a decline in oil prices, a possible financial crisis, that again are likely to change the trajectories of labor demand. In the second work package, we add data on labor productivity of firms, and analyse how the crisis impacts productivity growth, job reallocation, inequality, and polarization in the labor market. We depart from underlying trends in productivity and changes in relative demand for different types of labor, and study the extent to which these trends are magnified or ameliorated during the different phases of the downturn. The third work package is comparative. We use nearly real-time data on job postings in Norway, Sweden, Denmark and the US, coupled with nearly real-time data on new hires, new separations and net job growth, we will map labor demand from January 2020, into the crisis and onward.

Activity:

BIA-Brukerstyrt innovasjonsarena